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Mediclinic International2023 ANNUAL REPORT
CONTENTS
INTRODUCTION
CHAIRMAN’S MESSAGE
CEO’S REPORT
PATHWAY TO SUITABILITY
THE CASINO REGULATORY
ENVIRONMENT
Key Regulatory Milestones in NSW
Legislative Reform in NSW
Key Regulatory Milestones in Queensland
Legislative Reform in Queensland
BOARD OF DIRECTORS
EXECUTIVE TEAM
FINANCIAL PERFORMANCE
SUSTAINABILITY
Sustainability Strategy
Social Responsibility
Safer Gambling
Financial Crime
Responsible Service of Alcohol
Environment
People
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THE STAR ENTERTAINMENT GROUP LIMITED
ACN 149 629 023
KEY PROJECTS
Queen's Wharf Brisbane
The Star Gold Coast
The Star Sydney
DIRECTORS', REMUNERATION
AND FINANCIAL REPORT
Directors' Report
Remuneration Report
Financial Report
ADDITIONAL INFORMATION
Shareholder Information
Corporate Information
2023 Corporate Governance Statement
2023 Annual General Meeting
Indicative Key Dates for FY24
Company Directory
About this Annual Report
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ACKNOWLEDGEMENT OF COUNTRY
The Star Entertainment Group respectfully acknowledges the
Traditional Owners of the land where our properties are situated.
This includes the Turrbal and Jagera Traditional Owners of the
Brisbane region, the Danggan Balun (Five Rivers) people of the
Gold Coast, and the Traditional Owners of the land in Pyrmont,
the Gadigal people of the Eora Nation.
We also wish to pay our respects to Elders past and present.
'Jalaman Making Honey' is a collaborative artwork created by Quandamooka artist
Delvene Cockatoo-Collins and The Star team members (2019).
INTRODUCTION
We are absolutely focused on improving and returning to suitability
in NSW and Queensland. We want The Star to be known for being
transparent, accountable and trustworthy. A values-led company
with robust governance. A company where our team members feel
safe and free to raise concerns wherever arising, and leaders listen
and act when those concerns are raised.
We have commenced the journey but there’s
work still to do and everyone needs to contribute.
Our remediation program will embed an all-
encompassing cultural and compliance mindset
across the business to enable it to meet societal
and regulatory expectations as a responsible
corporate citizen.
The goal is to enable a safe environment free from
the risk of criminal infiltration and the negative
impacts of gambling harm where our team
members, guests and communities can all thrive,
and we maintain strong relationships with our
regulators and governments.
Our new leadership team, working closely with
our new Board, will champion organisational
reform and ensure remediations are leader led.
Every team member of The Star has a role to
play and transformation will focus on building
effective organisational systems and processes
that enable all employees to be aware of their legal
and ethical accountabilities and have the skills to
address these.
We are learning from the lessons of our past and
are also investing in new people, systems and
processes to build our organisational capacity to
oversee this culture of continuous improvement.
We are committed to fundamentally changing our
business model and how our business is run.
The Star accepted the findings of both the
Bell Report and the Gotterson Report. We also
acknowledge the gravity of the conduct raised by
the appointed reviewers in both states and that
The Star did not live up to the trust placed in it
by the people of NSW and Queensland.
Post those reviews and findings there has been
significant change at Board and management level.
This renewal process represents a new start, a
‘fresh eyes’ approach to ensure what needs to be
done is done to earn back suitability.
Implementation and embedment of the significant
reforms required to restore and maintain our
suitability to hold casino licences will also help
build a sustainable long-term business that makes
positive contributions to the community and
continues as a major employer in both States.
David Foster
Chairman and Independent,
Non-Executive Director
Robbie Cooke
Group CEO | Managing Director
OUR COMMITMENT
To deliver sustainable outcomes for our
guests, our team members, the communities
in which we exist and our shareholders, by
providing entertainment, gaming and leisure
experiences in a safe, responsible and
ethical way. We will do this by embedding
our values to lead the organisation with
a focus on safer gambling and good
business practices.
Note: At the time of writing, The Star was refreshing its
Purpose, Vision, Values and Principles as part of the
cultural transformation program.
1
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT CHAIRMAN’S MESSAGE
As we progress into FY24, remediation measures
are at the forefront of our priorities. It is a
comprehensive and urgent focus. Remediation
actions have commenced and will be outlined in
more detail elsewhere in this Annual Report.
Since the outset of that process, we have been
committed to transforming our leadership and
culture, uplifting our risk management, safer
gambling and AML capability, embedding greater
accountability and more robust governance,
enhancing our control environments, improving
Financial Crime management and our overall
approach to harm minimisation. The journey has
started, but there is a lot more still to be done.
There was significant change at Board and
management level during FY23. Four former
members of the Board retired, including Ben
Heap who retired as Chairman and Non-Executive
Director on 31 March 2023. I consider it an honour
to have led the Board since that date, having
been appointed as a Non-Executive Director
on 15 December 2022.
All other current Non-Executive Directors also
joined the Board during FY23 – Michael Issenberg,
Deborah Page AM and Anne Ward. Toni Thornton
and Peter Hodgson were Board observers at
the time of writing with their appointments as
Non-Executive Directors pending necessary
regulatory approvals.
Chief Executive Officer Robbie Cooke joined the
business on 17 October 2022, bringing extensive
ASX-listed company and gambling industry
experience. Robbie has established a new
management team with a significant number of
senior hires. Almost 20 senior executives left the
business previously. I particularly want to thank
Robbie for his diligence and commitment during
such a challenging time for The Star.
In FY23, AUSTRAC commenced civil penalty
proceedings, the company was served with
separate statements of claim and now has
four securities class actions in the Supreme
Court of Victoria, a review continued into the
underpayment of casino duty in NSW, and an
$800 million equity raising was launched in
February and successfully completed. I want to
sincerely thank existing shareholders for their
ongoing support during the equity raise process
and welcome all new additions to our register.
David Foster
Chairman
The 2023 financial year will be
remembered as a watershed year for
The Star Entertainment Group. A period
when we committed to changing the ways
we fundamentally behave and operate.
It followed deep self-reflection, and
learning our lessons from the past, to help
ensure the events that left us challenged
in so many ways never happen again.
After the release of the Bell and Gotterson reports,
the business acknowledged transformative
steps were required to enable it to meet societal
and regulatory expectations as a responsible
corporate citizen.
The regulatory actions following the two
reviews saw our NSW casino licence suspended
indefinitely in October 2022. In December 2022
our Queensland licences in Brisbane and the Gold
Coast were suspended for 90 days on a deferred
basis, with effect from 1 December 2023.
The New South Wales Independent Casino
Commission (NICC) appointed Mr Nicholas Weeks
as Manager of The Star Sydney casino. The
Queensland Attorney General also announced
Mr Weeks in the role of Special Manager to monitor
operations of the Brisbane and Gold Coast casinos.
In both jurisdictions we were fined $100 million.
Amendments to the Casino Control Acts were also
legislated in both States during FY23, creating
change to the respective regulatory frameworks.
Now, for The Star, the focus is charting a path
to suitability, with a fierce determination to earn
back the trust and confidence of a community
that includes our regulators, governments,
shareholders, team members and guests. Holding
a casino licence is a privilege and we understand
the responsibility involved.
2
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT For FY23, Statutory EBITDA (before significant
items) was $317m, up 34% on the prior
corresponding period, and slightly above the
top end of the previously announced guidance
range. Statutory net loss after tax was $2.4bn
including significant items of $2.8bn. Significant
items primarily reflected non-cash impairment
of The Star Sydney, The Star Gold Coast and
Treasury Brisbane, ongoing regulatory and
legal costs, debt restructuring costs and
redundancy costs.
I want to thank the new management team under
Robbie’s stewardship, and my fellow directors, for
their ongoing commitment to the transformation
of The Star. It is dedication to remediation that will
enable us to create a truly sustainable business
making positive community contributions.
David Foster
Chairman
A rapid deterioration in operating conditions also
saw a trading update delivered to the market
in April 2023. Significant cost initiatives were
announced at the time, including a reduction of
approximately 500 full time employee roles across
The Star, a salary freeze for non-EBA employees
and a cancellation of the Group’s short-term and
other incentives for FY23.
Importantly, in August 2023, an in-principle
agreement was reached with the NSW Treasurer
on new casino duty rates. The previous Treasurer
had proposed rates that would have significantly
challenged the economic viability of The Star’s
Sydney business and put thousands of jobs in
jeopardy. The in-principle agreement with the
NSW Government is designed to protect both
the viability of The Star Sydney and jobs.
Despite the headwinds faced in FY23,
construction progressed at the transformative
Queen’s Wharf Brisbane project, a joint venture
with our partners Chow Tai Fook International
and Far East Consortium. The timing for the
expected phased opening of the development has
been revised from end of calendar year 2023 to
April 2024. A dispute between the joint venture
vehicle, Destination Brisbane Consortium, and the
contracted builder of Queen’s Wharf led to legal
proceedings being brought in the Supreme Court
of Queensland by the builder in early FY24.
Construction works also continued at the Gold
Coast with the Tower 2 development, which is part
of a government-approved masterplan where a
further three towers can potentially be added to
the entertainment, leisure and tourism offerings
on Broadbeach Island.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT CEO’S REPORT
Robbie Cooke
Group CEO | Managing Director
Our business faced extraordinary
challenges during FY23, but those
difficult times have enabled us to rethink,
reshape and reimagine the future for
The Star. We are on a journey to restoring
our suitability and earning back the
trust of the community. It will take time,
but we are committed to being a better
company, operating with the highest
levels of integrity.
The consequences flowing from the damage to
our social licence are felt daily by team members
on multiple levels and it reinforces the need
to understand the privilege that comes with
holding a casino licence. We are committed to
transformation, and dedicated to building a culture
where our people are safe, ethical and respectful
of the environment in which we operate.
To achieve this, we are taking steps to promote
a responsible workplace that minimises the
negative impacts of gambling-related and
any other type of harm. This comes from an
understanding of the importance of meeting
our social obligations and addressing business
critical issues by implementing effective risk
management strategies.
We will embed that culture, be more transparent
as a business, have more robust governance,
greater accountability, be open and honest with
our regulators and act swiftly when issues arise.
As a new-look leadership team and Board, we will
do everything in our power to transform The Star.
This is an amazing business and I do want to
thank our approximately 8,000 team members
whose commitment, enthusiasm and inspiration
continues to help deliver outstanding customer
service at our entertainment, gaming and leisure
destinations in Sydney, Brisbane and the Gold
Coast. Our people are the heartbeat of this
company, and their ongoing loyalty and hard
work is deeply appreciated.
4
After joining the business in October 2022,
I have had the pleasure of welcoming significant
expertise to The Star’s Group Leadership Team.
From December 2022, we have announced the
following new appointments: Chief Financial
Officer, Chief Risk Officer, Chief Transformation
Officer, Chief Legal Officer, Group Company
Secretary, Chief Controls Officer, General Manager
Financial Crime, General Manager Safer Gambling
Compliance, and Whistleblower Protection Officer.
The Star’s organisational structure is also
changing. The driver for this being a desire to
create a simpler structure with more decision-
making power at a property level, while
maintaining appropriate oversight at a group level.
It will be the oversight elements, with the right
checks, balances and assurance systems in place,
that will help to ensure failings identified in the
Bell and Gotterson reports never re-occur.
On the financials front, for FY23, The Star
achieved normalised and statutory EBITDA
(before significant items) of $317m and normalised
net profit after tax of $41m. The statutory net loss
after tax was $2.4bn including significant items
of $2.8bn.
The Group started FY23 positively after COVID-19
restrictions began easing in late FY22, and
operating conditions returned to a more normal
state. There were strong monthly revenue results,
particularly in the Gold Coast and Brisbane,
during 1H FY23. However, there were factors that
impacted Sydney and the Gold Coast during the
second half of the financial year.
They included the implementation of uplifted
controls, which necessarily resulted in increased
exclusions; the important uplifting of risk
and compliance resourcing; the introduction
of competition in the Sydney table game
market; some operating restrictions impacting
customer experience; and a deterioration in
economic conditions.
More broadly, there have been various significant
matters for us to deal with as a business through
FY23 and into FY24. AUSTRAC commenced
civil penalty proceedings in relation to alleged
contraventions of obligations under the Anti-
Money Laundering and Counter-Terrorism
Financing Act 2006. Parties are working towards
establishing a statement of agreed facts and
admissions by 1 November 2023.
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Other strategic priorities include:
• Manage planned capital expenditure programs
to deliver value and returns for shareholders.
• Identify, retain, develop and engage a highly
talented team of employees across properties
and in the Group.
More immediately, in FY24, management’s focus
will be on:
• Operations (including preparation for the
introduction of cashless and carded play,
completing the refinancing of existing debt
funding arrangements, and completing the
appointment of key executive roles).
• Major Projects (completing construction,
managing costs and preparing for the phased
opening of Queen’s Wharf Brisbane, and
progressing the construction of Tower 2 at
the Gold Coast).
• Asset Sales (completing the sale of the
Sheraton Grand Mirage at the Gold Coast
and exploring options for the Treasury
Brisbane assets).
In closing, I wish to thank the Board and
Management for their considerable support since
my arrival. We are working hard to ensure the
future will be better and brighter for The Star.
Robbie Cooke
Group CEO | Managing Director
Four separate class actions have been
commenced in the Supreme Court of Victoria,
alleging misleading or deceptive conduct
in relation to market disclosures, and the
contracted builder of the Queen’s Wharf Brisbane
development has commenced a process in the
Supreme Court of Queensland against Destination
Brisbane Consortium, the joint venture between
The Star and its Hong Kong-based partners.
On 11 August 2023, The Star announced it had
reached an in-principle agreement with the NSW
Treasurer to amend casino duty rate agreements
with the State. It was an outcome designed to
protect the viability of The Star Sydney and
thousands of team member jobs. The agreement
was driven by a formal, consultative and
structured negotiation process put in place by the
Government — a welcome change to the approach
taken by the previous NSW Treasurer.
In addition, as part of the in-principle agreement,
The Star Sydney is committed to introducing in
October 2023 a trial of its cashless technology
on 50 gaming machines and 8 gaming tables.
It would be remiss of me not to mention an
experience during FY23 that I consider one of
the most painful of my career. On 19 April 2023
we announced a cost reduction initiative that led
to approximately 500 of our colleagues leaving
The Star. It followed a significant and rapid
deterioration in operating conditions, most notably
at The Star Sydney and The Star Gold Coast.
In terms of key strategic priorities for the Group,
remediation measures feature strongly:
• Comprehensive and urgent focus on
remediation actions including cultural
transformation.
• Achieve suitability and have licence
suspensions lifted.
• Repair and strengthen the Group’s relationship
with relevant regulators and other stakeholders.
5
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT PATHWAY TO SUITABILITY
While continuing to work towards an approved
plan, a range of initiatives were actioned across
several months as part of the ongoing Foundation
Period of the program. They included:
• Delivery of ‘rapid controls’ into The Star Sydney,
predominantly related to Customer Probity/
AML. Priority controls were also rolled out later
in Queensland.
• Implementation of new Internal Control Manuals
in NSW, a project involving ~150 personnel over
an eight-month period.
• Significant uplift in AML capabilities – team
expanded from 26 to 99 full time employees
(June 2022 to August 2023).
• Significant uplift in safer gambling capabilities
from 18 to 55 full time employees (June 2022
to August 2023).
• Root Cause Analysis completed by Deloitte.
• Development of a culture renewal roadmap
following a review by The Ethics Centre.
• The splitting of the Legal and Risk functions.
• Laying the foundations of a Three Lines of
Accountability model.
• Senior executive appointments made.
• Board renewal materially progressed
(entire Board replaced).
• Additional facial-recognition cameras in Sydney
and commencement of facial recognition on the
Gold Coast.
• Enhanced Underage Prevention Technology.
• Launch of an updated Whistleblower hotline
and escalation campaign.
The Star’s remediation
program has the goal of
earning back the trust and
confidence of regulators,
governments, shareholders,
team members, guests and
the community at large
and returning to suitability
in NSW and Queensland.
To achieve this, The Star is committed to
transforming its culture, governance, risk and
compliance management, accountabilities
and capabilities, and its approach to harm
minimisation.
The Star commenced the development of
a remediation program in late August 2022
to address issues identified by the Bell and
Gotterson reviews.
Planning was later adjusted to prioritise and
incorporate additional priorities set by the
Manager/Special Manager, who was appointed
following the indefinite suspension of The Star’s
NSW casino licence and the deferred suspension
of The Star’s Queensland casino licences.
A comprehensive draft remediation plan including
approximately 550 milestones to be actioned
over a multi-year period was formally submitted
mid-2023 for review by regulators in NSW and
Queensland. The plan continues to evolve but was
not yet approved heading into the final quarter of
the calendar year.
6
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT INTERNAL CONTROL MANUALS
Internal Control Manuals (ICMs) govern the
way The Star works. They are set by regulatory
bodies, Liquor and Gaming in NSW and OLGR in
Queensland, and set out principles, decision-
making, and conduct within The Star.
The ICMs are important foundation stones to help
to ensure an uplift in risk and compliance culture
and establishing what The Star wants to be known
for: a trustworthy company of robust governance;
transparency; and accountability.
The regulatory environment has seen a
significant number of changes to existing
ICMs (approximately 1,300 across NSW and
Queensland) and the introduction of new ICMs.
Planning for the implementation of new ICMs in
NSW started in late 2022. The updated NSW ICMs
started coming into effect on 1 April 2023, with full
compliance required by 1 July 2023.
The Star has introduced 546 unique controls in
NSW, implemented over 900 requirements, while
also updating Standard Operating Procedures and
related processes as part of the uplift program.
In Queensland, the ICM Uplift journey commenced
in a phased approach. The Star proposes to have
phases one and two (out of three) completed by
30 November 2023.
Board and Management Updates
July 2022
• New Independent Non-Executive Director
(Michael Issenberg) appointed
October 2022
• New operational Risk Committees
established for Sydney and Queensland
• New independent Compliance Committee
established for The Star Sydney
casino operator
• New Group Chief Executive Officer
(Robbie Cooke) commenced
November 2022
• New Board Safer Gambling, Governance
and Ethics Committee established
March 2023
• New Independent Non-Executive Director
(Deborah Page AM) appointed
• New Chairman (David Foster) appointed
April 2023
• New General Manager Financial
Crime commenced
• New Whistleblower Protection
Officer appointed
• New operational Financial Crime
Oversight Committee established
May 2023
• New Chief Transformation Officer
appointed
• New Chief Legal Officer commenced
• New Independent Non-Executive Director
• New General Manager Safer Gambling
(Anne Ward) appointed
Compliance commenced
• New Independent Non-Executive Director
Proposed (Toni Thornton) subject to
regulatory approval
December 2022
• New Chief Financial Officer appointed
• New Independent Non-Executive Director
(David Foster) appointed
February 2023
• New Chief Risk Offer commenced
July 2023
• New Independent Non-Executive
Director proposed (Peter Hodgson)
subject to regulatory approval
• New Group Chief Controls
Officer commenced
7
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT THE CASINO
REGULATORY ENVIRONMENT
LEGISLATIVE REFORM IN NSW
In August 2021, the NSW Government accepted
all 19 recommendations in the Bergin report and
introduced the Casino Legislation Amendment
Bill 2022 (the Bill) to give effect to the report’s
recommendations to strengthen casinos’
compliance requirements.
The Bill also included an expansion of the powers
of the regulator to prescribe certain matters in
casino's internal controls; specifically related
to money laundering risks, patron account
monitoring, due diligence, source of funds
declarations and responsible gambling.
The Bill was introduced to the NSW Parliament
on 5 August 2022 and passed into legislation on
11 August 2022. The NICC formally commenced
operations on 5 September 2022 and was
given the sole responsibility to regulate NSW’s
two casinos and to deal with findings of the
recent inquiries. Following the passage of the
Bill, internal controls of The Star have been
extensively modified to strengthen requirements
relating to financial crime, customer probity,
responsible gambling, governance and reporting
and record keeping.
Other key reforms included:
• Regular reviews of casino licences.
• New disclosure and reporting obligations for
breaches, suspicious activity, and regular
monitoring of patron accounts.
• Phase out of cash transactions of more than
$1,000 per patron per day.
• Transition to mandatory carded play.
• A ban on casinos dealing with junket operators.
In September 2021, ILGA announced the
appointment of Mr Adam Bell SC to undertake
a review of The Star and its Sydney operations.
The Bell Review commenced in November 2021
in accordance with section 30 and 143 of the
Casino Control Act 1992 (NSW) and included
written submissions and public hearings.
Adam Bell SC handed down his findings on
31 August 2022. The Bell Report was publicly
released on 13 September 2022 and included
30 recommendations.
Australia’s casino industry
has undergone significant
transformation in recent
years with a number of key
reports and public inquiries
driving systemic and ongoing
reform across the country.
The Star Entertainment
Group operates casinos in
Sydney, Brisbane and the
Gold Coast.
KEY REGULATORY MILESTONES IN NSW
The regulatory environment for The Star’s casino
operations in NSW has undergone significant
change over the last two years including major
legislative changes to the Casino Control Act 1992
(NSW) and reforms to internal controls. In NSW,
the inquiry report from the Honourable Patricia
Bergin SC into the suitability of Crown Resorts to
hold a gaming facility licence (the Bergin report)
was provided to the NSW Independent Liquor and
Gaming Authority (ILGA) in February 2021.
The Bergin report made 19 recommendations to
reform the NSW casino regulatory environment
including legislative amendments to the Casino
Control Act 1992 (NSW). A key recommendation
of the report included the establishment of the
NSW Independent Casino Commission (NICC)
to monitor casino activities and take disciplinary
action against operators and individuals who
engage in misconduct.
8
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT The response to the Bell Report included:
• A show cause notice issued to The Star on
13 September 2022 by the NICC.
• The Star responded to the show cause notice
on 26 September 2022 outlining a proposed
pathway to suitability.
• NICC announced the indefinite suspension of
The Star’s NSW casino licence on 17 October
2022, appointed Mr Nicholas Weeks as manager
of The Star Sydney casino and ordered The Star
to pay a total pecuniary penalty of $100 million.
• The Star Sydney developed new Internal
Control Manuals under the direction of the
NICC and ILGA.
KEY REGULATORY MILESTONES
IN QUEENSLAND
The casino industry in Queensland has been
undertaking a period of significant reform
and remediation over the past 12 months
with important legislative changes already
implemented or underway to deliver safer
gambling practices and harm minimisation for all
Queenslanders. The Honourable Robert Gotterson
AO KC was appointed by Attorney-General and
Minister for Justice, and Minister for Women and
Minister for Prevention of Domestic and Family
Violence, The Honourable Shannon Fentiman
MP on 30 June 2022 to conduct an external
review of the Queensland operations of The Star
Entertainment Group (Qld Review).
The Qld Review’s scope was defined by Terms
of Reference and undertaken in three parts:
• Part A Review into the operations of
The Star Cold Coast and Treasury Brisbane.
• Part B Review of ongoing suitability of
The Star Group licencees.
• Part C Consideration of any further
improvements to casino procedures,
regulation, and legislative reform.
The Qld Review was undertaken between June
and September 2022 and included inviting written
submissions from the public and interested
organisations and convening public hearings.
Key outcomes included:
• Final report provided to The Honourable
Shannon Fentiman MP by The Honourable
Robert Gotterson AO KC on 30 September 2022
for consideration.
• Public release of the final report on 6 October
2022 by The Honourable Shannon Fentiman
MP with a response from the Queensland
Government supporting in-principle the
Review’s 12 recommendations.
• Show Cause Notices being issued by the Office
of Liquor and Gaming Regulation to The Star
on 4 November 2022.
• The Star Entertainment Group provided a
comprehensive response to the Show Cause
Notices on 25 November 2022.
An outcome of the Show Cause Notice process
was announced on 9 December 2022 including
pecuniary penalties for The Star totalling
$100 million, appointment of Mr Weeks as
special manager, and a deferred suspension of
the Treasury Brisbane and The Star Gold Coast’s
casino licences until 1 December 2023.
LEGISLATIVE REFORM IN QUEENSLAND
The Honourable Robert Gotterson AO KC also
gave regard to the Casino Control and Other
Legislation Amendment Bill 2022 (Qld) (Qld Bill)
which was also before the Queensland Legislative
Assembly while the Review was being undertaken.
The Casino Control and Other Legislation
Amendment Bill 2022 (Qld) was introduced
into the Queensland Legislative Assembly
on 26 May 2022. The Qld Bill was referred
to the Legal Affairs and Safety Committee for
consideration which recommended the Qld Bill’s
passage. On 14 October 2022, the Qld Bill was
passed including provision for a special manager
to be appointed to monitor and direct casino
operations; an increase of pecuniary penalties up
to $100 million, and obligations to report breaches.
The Queensland Government announced it would
continue to progress further legislative reforms
recommended by the Qld Review.
9
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT BOARD OF DIRECTORS
DAVID FOSTER
Chairman and Independent,
Non-Executive Director
Joined the Board on
15 December 2022. Became
Chairman 31 March 2023.
Master of Business Administration;
Bachelor of Applied Science;
Fellow of the Australian Institute
of Management; Senior Fellow
of the Financial Services
Institute of Australasia; Member
of the Australian Institute of
Company Directors.
ANNE WARD
Independent,
Non-Executive Director
Joined the Board on
18 November 2022.
Bachelor of Laws; Bachelor of
Arts; Barrister and Solicitor of
the Supreme Court of Victoria;
Fellow of the Australian Institute
of Company Directors.
MICHAEL ISSENBERG
Independent,
Non-Executive Director
Joined the Board on
11 July 2022.
BS in Hotel Administration —
Cornell University USA; French
Order of Merit (Ordre national
du Mérite).
DEBORAH PAGE AM
Independent,
Non-Executive Director
Joined the Board on
13 March 2023.
Bachelor of Economics; Fellow
of Chartered Accountants
Australia and New Zealand;
Fellow of the Australian Institute
of Company Directors; Member
of Chief Executive Women.
ROBBIE COOKE
Group CEO | Managing Director
Joined the Board as Managing
Director on 18 November 2022.
Bachelor of Laws (Honours);
Bachelor of Commerce; Graduate
Diploma in Company Secretarial
Practice; Solicitor of the Supreme
Court of Queensland; Associate
of the Governance Institute of
Australia; Member of the Australian
Institute of Company Directors.
Board Changes
See page 1 of Directors’ Report.
10
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT EXECUTIVE TEAM
As at 1 August 2023
ROBBIE COOKE
Group CEO | Managing Director
CHRISTINA KATSIBOUBA
Group Chief Financial Officer
SCOTT SAUNDERS
Group Chief Risk Officer
BETTY IVANOFF
Group Chief Legal Officer
GEORGE HUGHES
Group Chief Customer
and Product Officer
JESSICA MELLOR
Chief Operating Officer,
The Star Gold Coast
KELVIN DODT
Chief Operating Officer,
The Star Brisbane
PAULA HAMMOND
Group Chief People Officer
PETER JENKINS
Chief of Staff, Office of the CEO
NICOLA BURKE
Chief Transformation Officer
(Subject to all regulatory approvals)
LAURENT FRESNEL
Group Chief Technology
and Innovation Officer
(Subject to all regulatory approvals)
RAV TOWNSEND
Group Chief Controls Officer
(Subject to all regulatory approvals)
Executive Changes
Scott Wharton (appointed Chief Executive Officer The Star Sydney and Group Head of Transformation 20 July 2022,
Resigned effective 28 April 2023).
11
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT FINANCIAL PERFORMANCE
The Group started FY23 positively. COVID-19
restrictions began easing in late 2H FY22. 1H
FY23 saw a number of strong monthly revenue
results, particularly in Gold Coast and Brisbane,
as the properties enjoyed strong domestic tourism
and pent-up demand following the relaxing
of COVID-19 enforced restrictions. However,
conditions turned in Sydney and Gold Coast in
2H FY23.
Factors impacting the operating performance
included: the implementation of uplifted
controls, which necessarily resulted in increased
exclusions; the important uplifting of risk and
compliance resourcing; the introduction of
competition during the period in the Sydney
table games market; some operating restrictions
impacting customer experience; and weaker
consumer discretionary spending.
GROUP PERFORMANCE (VS PCP)
Statutory EBITDA*
Domestic revenue
Operating expenses
EBITDA margin
$317M
UP 33.6%
$1.86BN
UP 22.1%
$1.09BN
UP 20.1%
17%
VS 16%
SYDNEY (VS PCP)
Statutory EBITDA*
Domestic revenue
Operating expenses
EBITDA margin
$127M
UP 52.5%
$978M
UP 26.5%
$586M
UP 21.1%
13%
VS 11%
GOLD COAST (VS PCP)
Statutory EBITDA*
Domestic revenue
Operating expenses
EBITDA margin
$107M
UP 19.8%
$505M
UP 19.6%
$312M
UP 24.4%
21%
VS 21%
BRISBANE (VS PCP)
Statutory EBITDA*
Domestic revenue
Operating expenses
EBITDA margin
$373M
UP 14.8%
$196M
UP 11.3%
22%
VS 20%
$83M
UP 28.4%
* Before significant items
12
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT GROUP PERFORMANCE
Gross Revenue
Net Revenue1
EBITDA2
NPAT3
SYDNEY
Gross Revenue
Net Revenue
EBITDA
GOLD COAST
Gross Revenue
Net Revenue
EBITDA
BRISBANE
Gross Revenue
Net Revenue
EBITDA
STATUTORY
NORMALISED4
$m
1,867.5
1,867.5
317.4
(2,435.2)
vs pcp5
21.7%
22.3%
33.6%
1,102.6%
$m
1,867.5
1,867.5
317.4
41.3
STATUTORY
NORMALISED
$m
984.0
984.0
127.2
vs pcp5
25.6%
26.5%
52.5%
$m
984.0
984.0
127.2
STATUTORY
NORMALISED
$m
508.9
508.9
107.0
vs pcp5
19.9%
20.2%
19.8%
$m
508.9
508.9
107.0
STATUTORY
NORMALISED
$m
374.6
374.6
83.2
vs pcp5
14.8%
14.9%
28.4%
$m
374.6
374.6
83.2
vs pcp
21.9%
22.5%
35.0%
N.M.6
vs pcp
26.0%
26.9%
56.8%
vs pcp
19.9%
20.2%
19.8%
vs pcp
14.9%
15.0%
28.6%
THREE YEAR STATUTORY FINANCIAL RESULTS SUMMARY7
Gross Revenue
Net Revenue
EBITDA
EBIT
Significant Items (after tax)
FY21
$m
1,557.1
1,545.4
426.7
216.2
51.5
NPAT (before significant items)
109.4
vs pcp
11.0%
3.9%
51.3%
170.9%
55.0%
458.3%
Earnings Per Share (cents)
Full Year Dividend (cents)
6.1
-
N.M.6
-
FY22
$m
1,534.1
1,527.1
237.5
29.2
170.8
(31.7)
(21.3)
-
vs pcp
1.5%
1.2%
44.3%
86.5%
231.7%
N.M.6
N.M.6
-
FY23
$m
1,867.5
1,867.5
317.4
122.1
vs pcp
21.7%
22.3%
33.6%
318.2%
2,476.5
1,349.9%
41.3
(211.7)
-
N.M.6
893.9%
-
1. Net of player rebates and promotional allowances.
2. EBITDA is before equity accounted investments profits/losses and significant items.
3. Normalised NPAT is after equity accounted investments profits/losses and before significant items.
4. Normalised results reflect the underlying performance of the business as they remove the inherent win rate volatility of the International VIP
Rebate business, noting The Star suspended all rebate business in May 2022. Normalised results are adjusted using an average win rate of
1.35% on actual turnover, taxes and revenue share commissions and are before significant items.
5. Prior comparable period.
6. Not meaningful as the result moved between a profit and a loss.
7. For further information, please refer to the financial report contained in the Annual Report for the relevant financial year.
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
13
SUSTAINABILITY
The Star Entertainment
Group is committed to
minimising our impact
on the environment,
operating responsibly to
create safe and memorable
experiences for guests, as
well as fostering wellbeing
for our team members and
the community.
APPROACH
The Star Entertainment Group’s sustainability
approach is focussed on creating long term value
in the management of its environmental, social
and governance (ESG) risks and opportunities,
and working with regulators and stakeholders to
ensure a long-term sustainable business.
RESPONSIBLE BUSINESS,
SUSTAINABLE DESTINATIONS
In late 2022 The Star Entertainment Group
developed its second sustainability strategy
Responsible Business, Sustainable
Destinations. This strategy reflects The Star's
commitments to the environment, operating
responsibility and supporting the people within
our business and the community.
RESPONSIBLE BUSINESS, SUSTAINABLE DESTINATIONS SUSTAINABILITY STRATEGY
ENVIRONMENT
Create low carbon places
that support nature and
conserve resources
Climate and Energy
Contribute to a zero
carbon future
Waste
Reduce waste and
improve circularity
Nature and Biodiversity
Support biodiverse ecosystems
and curb nature loss
Water
Conserve water and
protect waterways
Sustainable Sourcing
Ensure sustainable
sourcing practices
RESPONSIBILITY
Lead with integrity to ensure safer
gambling, sustainable growth, and
zero tolerance for financial crime
Harm Minimisation and
Financial Crime
Go beyond compliance to ensure safer
gambling, harm minimisation and zero
tolerance for financial crime
ESG Transparency
Be transparent and accountable about
ESG performance, tax and donations
Security and Privacy
Ensure the security and privacy of
guests, staff and partners
Destination Stewardship
Develop environmentally and socially
sustainable precincts and tourism
Sustainable Business Performance
Deliver value to all stakeholders
through sustainable long-term growth
14
PEOPLE
Foster wellbeing and enhance
communities, within and beyond
our precincts
Community Commitment
and Development
Enhance community wellbeing,
prosperity and resilience
Diversity, Inclusion and Belonging
Empower a diverse and inclusive
culture where everyone has the
opportunity to thrive
Safety and Wellbeing
Support the physical and mental
wellbeing of our people and guests
Ethical Supply Chain
Ensure ethical sourcing and
protect human rights
Employee Attraction
and Development
Develop leaders and grow
meaningful careers
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT The Responsible Business, Sustainable
Destinations strategy has been aligned to the
United Nations Sustainable Development Goals
(SDGs) to understand how our actions impact
global sustainability priorities. In managing risks
and opportunities presented by our most material
issues, we contribute to SDGs 3, 6, 7, 8, 9, 11, 12,
13, and 16. As part of our business management
practices, we contribute to goals 4, 5, 10, 15 and 17.
The strategy has three key pillars — Responsibility,
People and Environment, and 15 key areas of
activity that respond directly to The Star’s most
material ESG issues as determined by its annual
materiality assessment and business activities.
For more information about the strategy and FY23
results, refer to the 2023 Sustainability Report at
starentertainmentgroup.com.au/annual-reports.
OUR ENVIRONMENTAL TARGETS AND ACHIEVEMENTS
NET ZERO
target Scope 1 and
Scope 2 carbon
emission by 2030 from
wholly owned and
operated assets*
90% ACHIEVED
and target to maintain
+90% of the portfolio
with third party certified
sustainability ratings
(Green Star, NABERS or
EarthCheck)
FOR EVERY
HECTARE
of land used by The Star
across it's resorts, we aim
to restore three hectares
in the wild over the next
two years (63 hectares
restored to date)
30%
target reduction
in carbon intensity
by FY23** (achieved
27% reduction from
FY13 base year)
120,000 TREES
will be planted over the
next two years (to date
63,500 trees planted)
ANNUAL ‘EDNA’
biodiversity assessments
to be completed at
The Star’s Farm
30%
target reduction
in water intensity
by FY23** (achieved
9% reduction from
FY13 base year)
100%
target of takeaway
food packaging to
be compostable
(currently at 98%)
Memberships
and Affiliations:
*Scope 1 and Scope 2 for wholly owned and operated assets
**Against a FY13 baseline
Notes: 1.69% of FY23 invoices based on cost were unbilled at the time of reporting. The missing usage for electricity has been estimated
0.01% (10MWh) and 3.66% (8,245GJ) for gas. The missing usage for water has been estimated 6.8% (36ML).
15
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT SUSTAINABILITY (CONTINUED)
MATERIALITY
The Star’s Responsible Business, Sustainable
Destinations Strategy is underpinned by a
materiality assessment process that is conducted
annually. The 2023 Materiality Assessment
process, issues description, alignment with
the United Nations Sustainable Development
Goals and the Sustainability Accounting
Standards Board primary and secondary
topics can be found on the company website,
starentertainmentgroup.com.au.
The following Materiality Matrix outlines how
significant issues were assessed using a
double materiality lens, i.e., their ‘importance
to stakeholders’ and ‘importance to The Star’.
To help ensure that each of the most material
issues identified as important to The Star
Entertainment Group and its stakeholders
is managed, measured and reported against,
all issues have been addressed in the new
strategy in addition to existing controls,
policies and programs.
MATERIALITY MATRIX
Environment
Responsibility
People
Community wellbeing and trust
Privacy and security
Safer
gambling
l
s
r
e
d
o
h
e
k
a
t
S
n
o
t
c
a
p
m
I
Employee health, safety, and wellbeing
Climate resilience
Guest security
ESG transparency
Sustainable precincts
Minimising environmental impacts
Employee engagement
and development
Sustainable and
ethical supply chain
Regulatory
compliance and
relationships
Responsible
business operations
Sustainable business
performance
Guest safety and
environment health
Nature and
biodiversity
Diversity, inclusion,
and equal opportunity
Impact on The Star (Financial Materiality)
Material Topics
Ranking
Topic
=1
=1
=1
=1
5
=6
=6
=8
=8
Safer gambling
Community wellbeing and trust
Responsible business operations
Regulatory compliance and relationships
Sustainable business performance
Employee health, safety, and wellbeing
Guest safety and environment health
Privacy and security
Guest security
16
Ranking
Topic
10
=11
=11
=13
=13
=15
=15
17
ESG transparency
Minimising environmental impacts
Sustainable precincts
Climate resilience
Employee engagement and deployment
Sustainable and ethical supply chain
Diversity, inclusion, and equal opportunity
Nature and biodiversity
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
SOCIAL RESPONSIBILITY
SAFER GAMBLING
Gambling is an enjoyable leisure and entertainment
activity. However, some people can develop an
unhealthy relationship with gambling and find it
difficult to gamble safely and control their time
and spending. Minimising gambling related harm
is a key focus for The Star Entertainment Group.
We are working actively with stakeholders and
our regulators to minimise harm to guests and the
broader community. This is crucial to fostering a
long-term, mutually beneficial relationship with
our guests, as well as upholding our corporate
responsibilities and social licence to operate.
In FY23, The Star rebranded our harm minimisation
program from Responsible Gambling to Safer
Gambling, to underscore the actions we are taking
to help make gambling and the environment we
create remain safe for both guests and staff.
This report covers several significant changes
implemented in FY23 to prevent or minimise
gambling harm. The approach blends our strategic
focus together with enhanced internal controls
and reforms identified by external reviews of our
operations in New South Wales and Queensland.
THE STAR’S SAFETY MEASURES
Safer Gambling Teams
Safer Gambling teams operate at each of
The Star’s properties to provide 24/7 specialised
support to both operational staff and guests.
To support a greater emphasis on Safer Gambling
programs and activities, The Star has undergone
an uplift in Safer Gambling capabilities across the
Group from 18 to 55 full time employees.
Safer Gambling teams provide dedicated
resources to manage all issues related to
harm minimisation. In addition to monitoring
the wellbeing of guests, their interactions
are designed to detect and manage actual or
potential harm.
As a further indication of the importance of harm
minimisation, The Star has introduced a General
Manager of Safer Gambling and compliance team
that supports frontline colleagues by ensuring
robust policies and procedures, regular reviews
and assurance measures are in place and
implemented.
In addition, The Star’s Safer Gambling training
for all team members has been refreshed, with
further enhancements to increase Safer Gambling
competencies and capabilities underway.
Play Break
The Star launched Play Break (formerly called
Time Play Management) over two years ago to
support guests to not gamble for long periods of
time. Recommended breaks in play provides a
strong reminder that guests should maintain an
appropriate balance between gambling and other
activities in their life.
Play Break electronically monitors a guest’s data
whenever their membership card is inserted in a
gaming machine or swiped at gaming table. When
they reach the system’s set time limits, an alert is
sent to a staff member who will locate the guest to
recommend a break and check on their wellbeing.
Since its introduction, Play Break has
undergone several enhancements to increase
its effectiveness, including a greater focus on
guest interactions at 3 hours and 6 hours, and a
requirement that guests not gamble for more than
12 hours within a 24-hour period, or for more than
48 hours within a 7-day period.
Gambling Harm Indicators Matrix
Using available research, The Star has developed
a Gambling Harm Indicators Matrix that highlights
whether a guest may be experiencing gambling
related harm. Consisting of a comprehensive list
of risk indicators, the Gambling Harm Indicators
Matrix helps inform what staff should do if risk
behaviours are observed. The Matrix is included
in the online training given to all staff and is on
The Star’s intranet site. In addition to training,
the Matrix is part of the Safer Gambling standard
operating procedures.
17
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT SOCIAL RESPONSIBILITY (CONTINUED)
Facial Recognition
Facial recognition technology now operates
at The Star Sydney and The Star Gold Coast
and will be implemented at The Star Brisbane.
This technology is an effective tool used to assist
in harm prevention and for managing excluded
persons who attempt to enter our premises in
contravention of their prevention of entry orders.
Previously this process relied heavily on the
recall of staff or information voluntarily supplied
from third parties. Recognising the importance
of privacy concerns, The Star does not use the
technology for any other purpose.
CONCLUSION
As we look to the future, The Star believes
that a robust and effective harm minimisation
program requires continuous improvement
and an innovative attitude.
We aim to minimise harm to individuals and the
broader community through our on-going actions,
as well as the following initiatives for FY24:
• Engage community and industry stakeholders
to ensure that we are considering diverse
perspectives and needs.
• Develop a renewed Safer Gambling Strategy
that considers recent research outcomes and
best practices.
• Ensure that all team members are aware of
gambling risks and responsibilities and have
the right competencies and capabilities.
• Enhance our use of data and insights and
outcomes measures.
• Create more opportunities for interactions with
our guests to help promote their wellbeing and
to meet their needs.
• Continue to evolve marketing communications
to support Safer Gambling.
1,446
1,000
Total welfare
checks in FY23
Total Safer Gambling
self-exclusions in FY23
Welfare Checks
Welfare checks are conducted by the Safer
Gambling team when there are indicators that
a guest may be at risk of experiencing harm.
Welfare checks allow team members to determine
if the guest is experiencing harm from gambling
and if so, take appropriate action. This may involve
providing information, access to support services
or requiring an exclusion from the casino.
Welfare checks are also an important interaction
because they provide a chance to build guest
rapport through conversations about Safer
Gambling and other topics of interest.
Exclusions
Our Group Exclusion Policy provides further
protection for guests who have self-excluded,
or excluded based on an assessment by The
Star Entertainment Group that they are at risk
of gambling related harm. An exclusion at one of
our casinos is automatically applied to all casinos
operated by The Star. Exclusion information
is also shared between The Star Sydney and
Crown Sydney.
Online Self-Exclusion
Some people prefer not having face to face
interactions when going through the self-exclusion
process. As a result, The Star has introduced an
online self-exclusion form that can be completed
and forwarded to The Star for follow up action.
This online channel provides a pathway for people
who may have previously been reluctant to self
exclude onsite. However, The Star still provides
the option for people to initiate a self-exclusion
at any of our properties, or through their local
gambling help services.
18
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT FINANCIAL CRIME
The Star has commenced a comprehensive
program of work to remediate breaches and uplift
its management of financial crime risk. During the
past financial year, The Star has undertaken and
continues to undertake, a detailed review of its
risk management policies, processes, procedures,
systems and controls and commenced the
process of making required improvements.
To date, The Star has enhanced its oversight
and governance framework for financial crime,
including the establishment of executive and
management level financial crime committees,
enhanced a number of financial crime risk
assessment methodologies, improved its
customer screening controls, uplifted its
‘know your customer’ and enhanced customer
due diligence processes, deployed additional
transaction monitoring rules and implemented new
cash limits across its properties. The Star has also
increased resourcing in its first and second line
financial crime risk teams to support the delivery
of the uplift in its financial crime risk management.
The Star has a multi-year end-to-end program
of work designed to address various issues
and enhance its overall financial crime risk
management framework. The Star will continue
to focus on developing new and strengthening
existing, financial crime policies, processes,
procedures, systems and controls. The Star
continues to engage with AUSTRAC and our
State based regulators to provide updates on
our program of work.
RESPONSIBLE SERVICE OF ALCOHOL
(RSA)
The Star is committed to providing a safe
and secure environment for all patrons, and
our RSA program is supported by policies,
procedures, and mandatory training for all
team members.
RSA committees in each property meet monthly
to manage and monitor activities and incidents
related to the RSA program and work towards
continuous improvement. The Star also meets
regularly with regulators and stakeholders to
engage in constructive discussions regarding
initiatives that promote the responsible service
of alcohol.
Board oversight of the RSA program is provided
by the Safer Gambling, Governance and Ethics
Committee. The Star’s RSA program ensures
relevant regulatory requirements are maintained
for each property by ensuring:
• Safe venues are provided by refusing entry
or service to intoxicated patrons, managing
undesirable activity, and providing role-specific
training for venue managers and team members.
• Measures are taken to minimise harm, such as
not permitting the sale, supply, or consumption
of alcohol by individuals under 18 years old,
prohibiting promotions that encourage excessive
drinking or harassment, providing free drinking
water, offering light, mid-strength or non-
alcoholic options at lower prices, offering food
and snacks, promoting drink spiking awareness,
limiting the number of drinks purchased during
high-risk periods and displaying signage related
to alcohol restrictions.
• Community amenity is considered through the
reduction of noise, through safe and responsible
advertising of alcohol, and through support for
government and community initiatives related
to safe consumption.
REPORTING AND ASSURANCE
The Star has obtained limited assurance over
selected sustainability metrics. These include
selected environmental, safer gambling, safety,
and gender diversity metrics.
In FY23, the company again released a
stand-alone Sustainability Report which has
been prepared with reference to the Global
Reporting Initiative Standards.
The Assurance Statement can be found within
the 2023 Sustainability Report on the company
website at starentertainmentgroup.com.au/
annual-reports.
19
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT ENVIRONMENT
CLIMATE AND ENERGY
The Star Entertainment Group is committed to
supporting the transition to a low carbon economy
and is working towards achieving net zero Scope
1 and Scope 2 emissions from fully owned and
managed assets by 2030.
Climate change risks are included in the company
risk register and are managed under the normal
risk processes with oversight from the Board.
Within the financial year, climate change has also
been identified as a strategic business risk.
ALIGNMENT WITH THE TASKFORCE
ON CLIMATE RELATED FINANCIAL
DISCLOSURES
The Star Entertainment Group has adopted the
Recommendations of the Taskforce on Climate-
related Financial Disclosures (TCFD) and has
been working to implement the TCFD framework
into the business over the last five years with
the understanding that its investments may be
susceptible to future changes in climate.
The Star released its first report in 2020. During
the financial year, The Star released its fourth
Climate-related Disclosures Report which details
progress made on prior commitments to manage
possible physical, financial and transitional
risks, and sets out the company’s plans for the
coming years. This includes conducting physical
climate risk assessments. The results of these
assessments are included within the company’s
annual TCFD disclosures.
Climate adaptation and mitigation design and
operational requirements to manage resilience
and potential physical climate risks continue to
be updated annually in The Star’s Sustainable
Design and Operational Standards on the
company website. Access The Star's Sustainable
Design and Operational Standards here:
https://www.starentertainmentgroup.com.au/
environment.
20
NET ZERO 2030 (SCOPE 1 AND SCOPE 2)
AND CARBON EMISSIONS MANAGEMENT
The Star is committed to long term carbon
emissions reduction. To support the transition to
a low carbon economy the Group is targeting net-
zero Scope 1 and Scope 2 carbon emissions for its
wholly owned and operated assets by 2030. The
pathway to achieve net zero Scope 1 and Scope 2
by 2030 for the Group includes the purchasing of
renewable electricity, onsite solar (where possible),
electrification over time, continuing with the
Group’s energy efficiency program and developing
a carbon offsetting project and strategy that
delivers environmental and social benefit.
The Group’s Scope 1 and Scope 2 emissions
for FY23 were 9,774 tonnes (tCO2-e) and
83,806 tonnes (tCO2-e) respectively. In FY23, a
third-party consultancy was engaged to establish
a Decarbonisation Roadmap, outlining short,
medium and longer-term activities for achieving net
zero Scope 1 and Scope 2 by 2030. The roadmap
also includes analysis and prioritisation of energy
efficiency opportunities to help accelerate delivery
in addition to wider activities including renewable
energy procurement, electrification of assets and
carbon offsets.
OUR NET ZERO PATHWAY TO 2030
2013 Baseline
Energy efficiency
2030
On-site renewables
Renewable procurement
Refrigerant phase out
Offsets
2030 NET ZERO SCOPE 1 AND 2
Our material issues align with both primary
and secondary SASB topics.
A Scope 3 materiality assessment completed in
2022 identified The Star’s most carbon intensive
products and services in the supply chain and
considered both future capital projects and
suppliers. This detailed review identified 114,525
tonnes of Scope 3 emissions and will assist with
implementing category management plans to
begin to reduce Scope 3 emissions and support
the assessment of targets and opportunities
throughout 2024. The Star has assessed its
baseline Scope 3 emissions and is in the process
of building out management plans to apply to
procurement categories that begin with the
highest emissions sources. This work is ongoing.
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT EMISSIONS AND ENERGY INTENSITY
In FY23 visitation and resource consumption
returned to more normal operating levels post
COVID-19. Energy services across all properties
including lift services, lighting and HVAC all
returned to full operating hours and were
uninterrupted throughout the year. As a result,
total energy consumption increased compared
to the previous year, however carbon emissions
decreased with the renewable energy grid bonus.
The company’s total energy consumption was
602,960 GJ for FY23, which was an increase from
567,719 GJ in FY22, however a decrease from
607,476 GJ in base year FY13. Total Scope 1 and
Scope 2 carbon emissions were 93,580 tonnes
(tCO2-e) for the year, which was a decrease from
96,838 tonnes (tCO2-e) in FY22 and an overall
decrease from 108,595 tonnes (tCO2-e) in FY13
base year.
The company has a target to reduce emissions
by 30% on an intensity basis (square meters)
measured form baseline year FY13 concluding
in June 2023.
The company reduced its emissions intensity
by 27% from base year (2013) which was 3%
short of target. This shortfall was due to the
redeployment of business resources over the past
24 months to address remediation and business
transformation priorities.
As a result, capital invested into planned large
scale equipment and plant replacement activities
that would have achieved carbon reductions
were put on hold during this time. However the
company is continuing with building optimisation
activities and analytics, prioritising opportunities
that deliver business benefits. Performance
details can be found on the company website,
www.starentertainmentgroup.com.au/environment.
• Emissions intensity per visitor decreased
28.05% in FY23 compared to FY22 from 9.09kg
CO2e to 6.54kg C02e.
• Overall energy intensity per visitor increased
in FY23 by 13.3% compared to base year FY13
from 37.22 MJ per visitor to 42.16 MJ per visitor.
• Energy intensity per visitor decreased 20.9%
in FY23 compared to FY22 from 53.32 MJ per
visitor to 42.16 MJ per visitor.
THE STAR'S CARBON EMISSIONS
0.42
108,595
0.31
0.30
96,838
93,580
9.09
6.65
6.54
FY13
(Base Year)
FY22
FY23
Carbon Emissions (tonnes CO2-e)
Emissions Intensity (kg CO2-e/visitor)
Emissions Intensity (tonnes CO2-e/area)
THE STAR'S ENERGY CONSUMPTION
2.34
607,476
1.83
567,719
1.95
602,960
37.22
FY13
(Base Year)
53.32
42.16
FY22
FY23
Energy Consumption (GJ)
Energy Intensity (MJ/visitor)
Energy Intensity (GJ/area)
Notes: 1.69% of FY23 invoices based on cost were unbilled at
the time of reporting. The missing usage for electricity has been
estimated 0.01% (10MWh) and 3.66% (8,245GJ) for gas.
21
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT ENVIRONMENT (CONTINUED)
SUSTAINABLE DESIGN AND
BUILDING EFFICIENCY
The Star is committed to sustainable design and
operations, and develops and operates its assets
in alignment with its Environmental Management
Policy, Sustainable Design and Operational
Standards and its net zero Scope 1 and Scope 2
and resource performance targets.
The Group’s Sustainable Design and Operational
Standards, which can be found on the company
website, www.starentertainmentgroup.com.
au/environment, demonstrate the company’s
commitment to green building ratings and building
world class integrated resorts. The Standards,
aligned with Green Star Performance standards,
provide suppliers, builders, contractors and
Property Operations teams recommendations by
category to guide more sustainable design and
material use.
In FY23, The Star maintained its target that
over 90% of portfolio by floor space was third
party certified with a sustainability rating which
includes NABERS, Green Star or EarthCheck.
The Star Gold Coast’s Green Star Performance
rating was also increased to three stars, which is
equivalent to good practice (an increase of one
star from its baseline rating of two stars), and
existing Green Star commitments progressed in
the development pipeline. The Group’s summary
of third party certificated Green Star and NABERS
ratings and commitments across is portfolio can
be found within the company’s Sustainability
Report at www.starentertainmentgroup.com.au/
environment.
The Star continues to review and monitor building
performance through its building optimisation and
analytics systems. The energy and water savings
and cost benefits from projects implemented are
reported through the companies Energy and Water
Project pipeline, now in its eighth year.
In FY23, The Star has completed 1 upgrade
project and 6 optimisation projects resulting in
energy savings of 1,318MWh, carbon savings
of 854 Tonnes (tCO2-e) and financial savings of
$324,000. Resource and cost savings continue
to be realised into FY24 as result of projects
identified and implemented in FY23.
22
POTABLE WATER CONSUMPTION
Water management forms part of the company’s
sustainability strategy and targets. The company
reduced its water consumption intensity (kL/SQM)
in FY23 by 8.9% compared to FY13 (baseline),
however was 21% short of target measured from
FY13 to FY23 target completion year.
The Star’s water consumption is inextricably
linked with visitation and the services provided
by its properties, including hotel facilities and the
operation of kitchens, bars and restaurants.
As a result of expected increases in visitation in
FY23, compared to the restricted operations and
property closures experienced FY22, water use has
been impacted. As normal operations resume, it is
anticipated water consumption will increase in line
with FY19 levels and property visitation trends.
Total potable water use for FY23 was 745ML.
Water consumption per visitor decreased 7.4%
in FY23 compared to FY22 from 56.22L/visitor to
52.08L/visitor and water consumption intensity
measured by square metre was 2.41kL compared
to 2.65kL/SQM in FY13 (base year). The Star
continues to monitor consumption and performance.
More information on water efficiency programs
and projects underway can be found in The Star's
FY23 Sustainability Report.
THE STAR'S WATER CONSUMPTION
2.65
688,440
1.93
598,603
2.41
744,763
42.19
FY13
(Base Year)
56.22
52.08
FY22
FY23
Water Consumption (kL)
Water Intensity (L/visitor)
Water Intensity (kL/area)
Notes: 1.69% of FY23 invoices based on cost were
unbilled at the time of reporting. The missing usage
for water has been estimated 6.8% (36ML).
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT FY23 WASTE AND
RECYCLING OUTCOMES
30
Recycling streams
diverted from landfill
Including batteries,
organics, soft plastics,
cardboard, linen
and uniforms.
46%
Waste diversion
in FY23
Representing a 13%
increase from FY22
recycling rates
THE STAR'S RECYCLING RATES
0.002
10%
0.03
FY13
(Base Year)
0.006
33%
0.17
FY22
0.012
46%
0.27
FY23
Recycling Rate (%)
Recycling Rate Intensity (kg/visitor)
Recycling Intensity (tonnes/SQM)
The FY13 base year for waste has been recalculated.
'Recycling intensity' kg/visitor has been used in FY17 to
FY23, not 'waste to landfill intensity' kg/visitor as used in
FY16, which better reflects recycling performance. Waste
data from the Gold Coast Convention and Exhibition Centre
is provided in volume and has been converted tonnage
to align with national waste data reporting. The 'Better
Buildings Partnership Operational Waste Guidelines' July
2018 conversion factors have been applied.
WASTE MANAGEMENT
The Star is committed to reducing total waste
volumes, improving waste diversion from landfill,
reducing food waste at the point of generation and
organics recycling and increasing the number of
recycling streams across its properties. The Star
is a member of the Australian Packaging Covenant
Organisation and submitted its first annual report
in the FY23 reporting year.
In FY23, a new Waste and Recycling Strategy
was implemented with a best practice, circular
economy approach. The strategy focuses on
opportunities to ‘close the loop’, including
a continued focus on textile waste and the
implementation of organics recycling at the
Queensland properties.
The Star’s waste and recycling figures include
all waste generated from operations. Waste and
recycling performance is benchmarked against
the base year FY13 to track improvement. In FY23
recycling rates lifted for the Group by 13% to 46%
compared to FY22 levels. This increase in landfill
diversion rates was supported by an increase
in textile recycling rates, donated furniture and
equipment, in addition to increased co-mingled
recycling tonnages.
The Star’s food takeaway packaging is 98%
compostable, targeting 100% as all packaging
material solutions become available. During FY23,
the Group continued its dynamic partnership with
innovative textile recyclers to maintain ground-
breaking pathways for obsolete uniform and
linens and diverting 23 tonnes of material in 2023.
Technologies have been deployed to weigh and
monitor waste generation levels at source at The
Star Sydney with further waste reviews conducted
in FY23. Food donation partnerships continue with
Oz Harvest with 67 tonnes of food donated to date.
Waste and recycling performance and programs
can be found on the company website,
www.starentertainmentgroup.com.au/environment
as well as The Star's FY23 Sustainability Report.
23
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT ENVIRONMENT (CONTINUED)
NATURE AND BIODIVERSITY
CORYMBIA, THE STAR’S CARBON OFFSET
AND NATURE-BASED FARM
In December 2020, The Star procured a parcel of
land in Gympie, QLD to establish its first carbon
offset project with the intent to create a land for
nature and for endangered species.
The project forms part of the company’s strategy
to achieve net zero Scope 1 and Scope 2 emissions
from fully owned and managed assets by 2030 and
will help support residual emissions offsetting.
The company registered an Emissions Reduction
Fund project with the Clean Energy Regulator
named Lower Wonga Native Regeneration Project.
During FY23 working closely with partners,
63,500 native trees and over 63 hectares have
been planted in line with the revegetation plan.
Audit work continues to generate ACCUs from
the planting progress towards The Star’s net
zero pathway.
Initial biodiversity assessments were completed
onsite to measure the abundance of native and
pest species onsite and to establish a baseline
for ongoing biodiversity monitoring. Annual
assessments continue to measure the proximity
and abundance of key species to the site,
particularly koala and glossy black cockatoo.
Sustainable agriculture opportunities are being
explored to provide produce streams in The
Star’s Queensland restaurants that support local
farming communities.
FY23
REVEGETATION PLAN
63,500 63+
Native trees were
planted at Corymbia
during FY23
Hectares of
land were used
in line with the
Revegetation Plan
24
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT TASK FORCE ON NATURE RELATED
FINANCIAL DISCLOSURES
Consistent with the commitments in the
company’s Responsible Business, Sustainable
Destinations strategy to contribute to support
biodiverse ecosystems and curb nature loss,
The Star is closely following the development
of the Taskforce for Nature-related Financial
Disclosures (TNFD).
The TNFD is a framework developed to enable
businesses to better understand, manage,
and disclose their nature-related risks and
opportunities. The TNFD is expected to release
its final recommendations in September 2023.
During FY23, The Star conducted a high-level
preparedness assessment to begin aligning to the
TNFD. This assessment identified the following
possible actions, which will be explored from
FY24 onwards:
• Governance: establish formal oversight of
nature-related risks and opportunities at
The Star.
• Strategy: conduct a nature-related risk and
opportunity assessment on select aspects
of The Star’s value chain.
• Risk Management: review The Star’s existing
processes relating to climate risk and supply
chain risk and consider opportunities for
integrating nature risk.
• Metrics and Targets: review and where
appropriate update The Star’s existing nature-
related targets and report progress against
these targets in future annual reporting.
The Star expects to include further information
on its approach to nature (including reporting
progress on key nature-related initiatives
such as Corymbia) in-line with the TNFD from
FY24 onwards.
UNITED NATIONS GLOBAL COMPACT
The Star Entertainment Group is a participant of
the UN Global Compact and reports in alignment
with global sustainable development frameworks.
In February 2021 the Group joined as a signatory
to the UN Global Compact Network Australia.
In line with membership requirements, the Group
releases annual Communication of Progress
reports which can be found on the UN Global
Compact Network website, unglobalcompact.org.
MODERN SLAVERY AND
ETHICAL SUPPLY CHAIN
The Star is committed to protecting and
supporting the rights of people within our
business and supply chain. We continue
to develop our human rights due diligence
process based on the United Nations
Guiding Principles on Business and Human
Rights to understand and address the risks
of modern slavery.
Through a review of our operations and data
analysis of 99% of our direct suppliers in
FY22, we have increased our understanding
of modern slavery risks and continue to
develop risk management and supplier
engagement programs accordingly.
With most of our direct suppliers located
in Australia, the inherent risk for our
supply chain is relatively low, however
we understand that there may be risks
deeper in our supply chain that we
seek to better understand and manage.
This program of work is ongoing, and
undertaken by the Modern Slavery
Working Group that comprises members
from social responsibility, procurement,
and employee relations teams.
Modern slavery training is mandatory for our
legal, procurement and supply chain teams.
In FY23 we updated the on-line training
module in line with the Global Slavery
Index, and we are planning to conduct more
detailed engagement with our teams and
suppliers based on category specific risks.
Our Whistleblower Protection Policy and
whistleblower service encourages team
members, suppliers, and their employees
to raise issues anonymously and in multiple
languages. This is communicated in our
Supplier Code of Conduct, available on
our website and in the training for on-
premises contractors.
As part of our obligations under the Modern
Slavery Act 2018 (Cth), The Star provides
an annual modern slavery statement that
addresses reporting requirements during
the financial year, which is submitted to the
Australian Border Force Modern Slavery
Register by 30 December each year. To
read The Star’s Modern Slavery Statement
FY22 (published December 2022) please
visit starentertainmentgroup.com.au/
modernslavery.
25
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT To support our continued ability to self-insure
for workers’ compensation purposes, an external
audit was conducted in early 2023 which included
a review of our Safety Management System
and its implementation in key departments. Our
overall score was 87% which represented an
improvement on our previous 2021 audit result
and significantly exceeded the pass requirement
of 70%. Irrespective of this achievement, our
total recordable incident frequency rate, based
on accepted workers’ compensation claims,
has increased to 16.9. A review of our injury data
shows a trend for team members to suffer more
injuries in their first year of work for The Star
than those who have been with us for longer,
albeit these injuries are typically the result of
low consequence incidents. These insights
have underpinned an increased focus on manual
handling training and the training needs of our
apprentices. In addition, we have made bespoke
online health and safety risk management and
hazard identification training available to all
team members.
PEOPLE
SAFETY AND WELLBEING
The COVID-19 pandemic had a profound
impact on people’s mental health,
creating unprecedented challenges and
exacerbating existing mental health issues.
The prolonged disruption to daily routines,
financial insecurity, and loss of social connections
have contributed to increased stress, anxiety and
depression in the community. Our team members
and guests have not been immune to these
impacts. For our community, the pandemic has
not been the only challenge — the findings from
the Bell and Gotterson reviews have triggered
considerable organisational change.
We are mindful that psychosocial risks at work,
such as the effectiveness of change management,
can impact team members’ mental health. As
such, a key focus has been training leaders to
provide open and transparent communication
to destigmatise mental health issues and to
foster a culture of understanding, inclusion, care
and support. We are committed to continuous
improvement and having controls in place to
ensure psychological safety and wellness will
continue to be reviewed and strengthened.
We have prioritised raising awareness about
mental health and wellness through various
communication channels. Our intranet, email
newsletters and internal social platforms provide
regular updates on mental health resources and
initiatives including Unmind — our mental health
toolkit. Awareness facilitated by activities such
as leader-led 'Safety Shares' and 'Wellness Week'
have provided opportunities to encourage and
teach our people to build resilience, look out for
one another and recognise when colleagues might
be struggling, to have supportive conversations
and to support referrals to both leaders and our
Employee Assistance Program.
We have established wellbeing metrics to track
progress and to identify areas for improvement as
we endeavour to align initiatives with the evolving
needs of our people. Through team member
surveys and feedback mechanisms, we gather
valuable insights regarding the effectiveness
and perceived impact of our programs. This data
helps us identify trends, understand specific
challenges faced by different employee groups,
and make informed decisions to refine and expand
our initiatives. We regularly review our wellbeing
metrics to ensure they capture the holistic
nature of mental health and reflect the evolving
understanding of wellbeing in the workplace.
26
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Three significant health and safety projects were
conducted in FY23; an in-depth review of all
safety procedures for the swimming pools at each
of our properties; an examination of the factors
impacting our increased injury claim rate; and
the replacement of all balustrade glass on one of
our recently completed towers at the Gold Coast.
Two panels of balustrade glass spontaneously
broke which triggered a comprehensive risk
review by external consultants. With team member
and guest safety at the forefront of all decision
making and with an abundance of caution, The
Star commenced a balustrade glass replacement
program for the entire building.
The Star will continue to reinforce and strengthen
our safety practices, behaviours and culture
across all areas of the organisation in FY24.
The Star recognises that the wellbeing of our
people is important because healthy people are
safer, happier, more resilient, more collaborative
and more engaged. This results in better, more
effective decisions for themselves, their
colleagues and The Star.
FY23 SAFETY
MANAGEMENT OUTCOME
87%
Audit result
Significantly exceeding 70%
pass requirement score.
The Star recognises that
the wellbeing of our people
is important because
healthy people are safer,
happier, more resilient,
more collaborative and
more engaged.
SECURITY AND SURVEILLANCE
The Star continues to deliver 24/7 security
and surveillance monitoring in addition
to Standard Operating Procedures that
deal with and respond to any suspected
undesirable conduct across its three venues
in Sydney, Gold Coast and Brisbane.
Facial recognition technology now operates
at The Star Sydney and The Star Gold
Coast and will be implemented at The Star
Brisbane. This technology is an effective
tool used to assist in harm prevention and
for managing excluded persons who attempt
to enter our premises in contravention of
their prevention of entry orders. Previously
this process relied heavily on the recall of
staff or information voluntarily supplied from
third parties. Recognising the importance of
privacy concerns, The Star does not use the
technology for any other purpose.
In a further harm minimisation initiative,
The Star also deployed Patron Scan
devices to all Main Gaming Floor Entry
point locations in Sydney, together with
associated technology that includes Face
to Photo verification and digital signature
pads to assist in detecting minors.
This represented an upgrade on the
previous mobile device technology with
each entry point now equipped to compare
the person attempting to gain entry with
the identification article produced — most
commonly a driver’s licence.
Across the Group, a multi-million-dollar
uplift to move from a 30-day to a 90-
day retention of CCTV footage is being
implemented at the Sydney and Gold Coast
properties and in future at The Star Brisbane
as part of new regulatory requirements.
The Star has more than 7,000 CCTV
cameras installed across its three properties
and has almost 500 team members working
in the security and surveillance department.
More than 100 additional team members will
be employed for security and surveillance
operations at The Star Brisbane, and
the overall number of CCTV cameras in
operation across the Group will increase to
almost 10,000 when the transformational
multi-billion-dollar project comes online.
27
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT PEOPLE (CONTINUED)
DIVERSITY, INCLUSION AND BELONGING
The Star has an unwavering commitment
to diversity, equity and inclusion.
We are proud of our team member-led
network groups, Balance@TheStar,
Proud@TheStar, Unity@TheStar and
Reconciliation@TheStar.
BALANCE@THESTAR
We aim to promote gender equity in all aspects
of our business by championing change and
advocating opportunities for all individuals.
Our Target
Previously set at 45% female and 45% male
representation of leaders (levels 1–4) (with the
remaining 10% reflecting scope for non-binary
gender identities).
Workplace Gender Equality Agency
(WGEA) Compliance Report
On 31 May 2023, The Star submitted its
annual compliance report to the Workplace
Gender Equality Agency. The Star reported
an organisation-wide gender pay gap for total
remuneration for the 2022–23 reporting period
at 4.5% compared to 6.7% from the previous year
and the Australian national standard of 22.8%
(as of March 2022)*.
The Star’s overall female representation is at 46%.
Female representation in leadership (Level of Work
1–4) has increased from 37.7% to 39.9% in the past
12 months, whilst the Board composition sits at
40% as of 1 August, 2023 compared to the target
of 30%. Group Leadership Team composition
has also improved and is currently at 50% as of
1 August, 2023.
Recognitions
The Star was ranked #4 in the Top 101 Companies
for Women published in the Herald Sun on March
2023 in collaboration with Work180.
*Source: WGEA, www.wgea.gov.au.
28
Workplace Gender Equality Agency
— WGEA Employer of Choice for
Gender Equality
The Star is a proud recipient of the WGEA
Employer of Choice for Gender Equality (EOCGE)
awarded in March 2022. EOCGE is a recognition
of employers in Australia that have a genuine
commitment to gender equity.
International Women’s Day
On 8 March 2023, in celebration of International
Women’s Day (IWD), The Star conducted its first
in person, as well as virtual Balance@TheStar
panel discussion.
This year, The Star aligned with the UN
Women of Australia theme for IWD which is
#CrackingTheCode: Innovation for a
gender-equal future. This theme was focused on
breaking norms and disrupting 'business as usual'
to accelerate equality.
The event was attended by 177 team members in
person and online.
Balance@TheStar plays a key role in delivering
initiatives all year round. Some of the initiatives
delivered include:
• Annual Walk & Talk event, conversations
on gender equity within the workplace, and
networking with leaders from around the
business to help share an understanding
of barriers.
• Updated Paid Parental Leave Policy.
• Dedicated Parents’ Rooms in each of
our properties.
• Parents and Carers Community’s Keeping in
Touch Days to support team members during
parental leave.
• Looking at gender pay in like-for-like roles as
part of our annual remuneration review process.
Other celebrations include:
• National Carers Week.
• International Equal Pay Day.
• Movember.
• International Men’s Day.
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT PROUD@THESTAR
The Star’s LGBTQI+ employee-led network
group aims to create a safe and inclusive work
environment providing LGBTQI+ team members
a platform of support and representation, to
participate in LGBTQI+ days of significance and
to become an ally and friend of the community.
Australian Workplace for Equality Index
In November 2022, The Star received a Gold
ranking in the prestigious Australian Workplace
Equality Index (AWEI). To maintain Gold, The Star
will once again participate in this year’s AWEI
iteration and will commence with a Foundation
(Bronze) submission, followed by an Advance
(Gold) submission in January 2024.
Proud@TheStar initiatives include:
• Internal Ally Training.
• Trans and gender-diverse awareness training
for HR professionals.
• Review of LGBTQI+ HR inclusive policies
such as Domestic and Family Violence Policy,
Parental Leave inclusive of surrogacy, adoption,
foster and guardianship, and chosen families.
• Review of Gender Affirmation guide to
support team members and leaders in their
affirmation journey.
• Providing resources on LGBTQI+ inclusive
and negative language guides for leaders and
team members.
• LGBTQI+ inclusive recruitment.
Days of Significance include:
• IDAHOBIT celebrations.
• Wear it Purple Day.
• Intersex and Asexual Awareness Day.
• Sydney Mardi Gras and participation in the
World Pride 2023.
• International Transgender Day of Remembrance.
• Transgender Day of Visibility.
The Star has trained LGBTQI+ related Grievance
Officers and an advisory board to help team
members in all matters relating to gender
affirmation advice, bullying and harassment, trans
and gender diverse matters and so much more.
29
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT PEOPLE (CONTINUED)
UNITY@THESTAR
The Star supports cultural diversity and inclusion
for all and is driving leadership representation
and professional development for our Asian team
members, aiming for 20% Asian representation at
senior leadership level.
The Star is committed to a welcoming workplace.
We recognise the unique insights, perspectives,
and backgrounds of each team member.
Ambassador’s Program
Program Overview: Achieve an honest dialogue
through a safe and semi-structured series of
conversations, to share information and gain a
better understanding of what impacts the career
objectives and aspirations of our culturally
and linguistically diverse (CALD) leaders and
team members.
In August 2022, four members of the Group
Leadership Team and 11 CALD leaders completed
the program which concluded with a graduation
ceremony at The Star Gold Coast.
Other initiatives include:
• Unity/Belonging Week.
• Lunch and Learn.
• Stories@TheStar.
Celebrating all cultures at The Star
The Star believes that embracing and recognising
the rich tapestry of backgrounds, traditions, and
perspectives helps create an inclusive workplace
where everyone feels valued and respected.
The Star celebrates:
• Lunar New Year.
• Harmony Day.
• International Day Against Racism.
• Ramadan, Eid al-Fitr.
• Diwali celebrations.
30
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT RECONCILIATION@THESTAR
The Star Entertainment Group’s vision for
reconciliation is an Australia that is fair and
inclusive and celebrates Australia’s First Nations
people and culture.
We recognise the importance of working in
respectful partnership with Aboriginal and Torres
Strait Islander people and businesses to create
sustainable and collaborative opportunities for a
reconciled Australia.
Reconciliation@TheStar employee network
group meets monthly to learn, share and work
together toward reconciliation through the
following priorities:
• Awareness and education.
• Community and team engagement.
• Local approach.
Our Mission
• Create meaningful engagement with
our Aboriginal and Torres Strait Islander
team members.
• Create safe and inclusive spaces for team
members and guests.
• Support Aboriginal and Torres strait islander
communities and businesses.
Initiatives include:
• Participation in the First Nations Employment
Index 2022 and upcoming 2024.
• Partnership with National Indigenous Culinary
Institute to help create highly skilled Indigenous
chefs by providing apprentices with appropriate
training and mentorship.
NAIDOC Week
NAIDOC week celebrations highlight the rich and
diverse cultures, histories, and achievements of
Aboriginal and Torres Strait Islander peoples.
NAIDOC week is an opportunity to learn about,
support, and participate in celebrations of the
oldest continuous living cultures on Earth.
Concept image for illustrative purposes only.
Nevile Bonner Bridge,
Queen’s Wharf Brisbane
The life and legacy of Australia’s first Indigenous
parliamentarian, Neville Bonner, is being honoured
with the naming of the Neville Bonner Bridge. The
inner-city pedestrian bridge is part of the Queen’s
Wharf Brisbane development.
Named Australian of the Year in 1979 and
appointed an Officer of the Order of Australia in
1984, Senator Neville Bonner worked tirelessly
to help Aboriginal people retain their cultural
identity while acquiring the economic, educational,
and social opportunities that non-Indigenous
Australians took for granted. He is remembered
for the contribution he made to increasing
understanding of the rich cultural heritage of
Aboriginal people. The Neville Bonner Bridge will
link both sides of the Brisbane River, forming a
stronger connection between the popular South
Bank arts and cultural precinct and the future
Queen's Wharf Brisbane precinct.
Days of Significance include:
• National Close the Gap Day.
• Reconciliation Week.
• NAIDOC Week.
• Indigenous Literacy Day.
31
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT PEOPLE (CONTINUED)
EMPLOYEE ATTRACTION
AND DEVELOPMENT
The Star is committed to learning, training
and development programs that continue
to build the talent of our people, deliver
outstanding guest experiences and ensure
all regulatory requirements are met.
Our team members are at the centre of what we
do and making sure all are equipped with the
necessary skills and training to do their roles
effectively, is critical.
The Star’s commitment to meeting new
regulatory requirements, regaining the trust of
stakeholders and returning to suitability in NSW
and Queensland, is reflected in the development
of a comprehensive draft remediation plan and the
design and delivery of an Internal Control Manual
uplift project.
The necessary training requirements as part of
updating our systems, processes and policies
have also been established.
Four new training modules were created
and numerous more updated in line with the
uplift requirements.
Team members are required to read
and understand the new policies and
compliance framework and complete the
corresponding training.
The Star’s training modules will not only ensure
compliance and regulatory standards are satisfied
but they will also contribute to our team members’
development through an uplift in skills.
In FY23, The Star launched a campaign
titled 'Raise It', aimed at creating a workplace
where all team members are encouraged and
empowered to raise concerns with their leaders or
by utilising other escalation options.
New, mandatory Whistleblower Training for all
team members in the business, was also created.
32
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT THE STAR ACADEMY
The Star is dedicated to building talented
teams that provide outstanding experiences
for our guests.
The company’s learning, training and development
programs focus on upskilling team members and
leaders across all our locations.
To facilitate and deliver on its commitment to train
team members, The Star Academy centres around
three pillars of learning: The Leadership Centre,
The Foundation Centre and The Skills Centre.
LEADERSHIP CENTRE
As part of the ‘Raise it’ Program, a face-to-face
training program for managers with direct reports,
was activated.
This was designed to help managers respond
supportively to staff who flag breaches and other
reportable events. Key data and reactions to the
first stage of training program included:
• 294 participants.
• 61% feedback response rate.
• 95% of participants agreed that the training
helped them.
• 93% satisfaction with the training.
In FY23, The Star’s Leadership Centre saw
the Discovery Suite and Supernova leadership
development programs completed.
The Discovery Suite delivered a package of
development modules designed to elevate the
capability of The Star’s leaders.
The Supernova program was introduced as a
specialised leadership program to support the
development of those in the organisation, who
were identified as part of a FY22 talent review
of future leaders.
Key data from the Supernova (high performer)
program included:
• 84% completion rate.
• Increased engagement scores for the 20
high performing leaders who completed the
Supernova program. (This was especially
noteworthy in the growth, mentoring and
openness scales, which averaged 1.2 points
above the benchmark).
• 57% of participants experienced a positive
move into a new role or are now in an
‘Achieving Leader’ pool.
• All candidates completed an externally
facilitated 360 feedback and coaching session.
FUTURE LEADERSHIP PLANS
• Launching a revitalised mentoring program
targeted at middle and senior managers.
• A 'Lunch and Learn' Program with risk,
compliance and legal seminars.
• Leadership Development as part of The Star’s
remediation program.
THE FOUNDATION CENTRE
The Star’s signature program ‘Star Quality’
is run from The Foundation Centre, along with
numerous development programs for team
members. Learning modules are offered virtually
and face to face facilitation occurs through
business leaders, and specialist learning and
development facilitators.
THE SKILLS CENTRE
The Skills Centre is home to all technical training,
providing team members specialised training and
development opportunities. It is home to The Star
Graduate Program, The Star Culinary Institute and
the Food and Beverage Skills Program.
33
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT THE STAR CULINARY INSTITUTE
Despite the challenge of labour shortages in
the hospitality industry across Queensland
and Australia, The Star Culinary Institute (SCI)
continues to attract, nurture, and develop
apprentices, who are highly skilled in the kitchen,
and passionate ambassadors for the industry.
SCI offers full-time and school-based
apprenticeships across Commercial Cookery,
Retail Bakery and Patisserie. In FY23, 10
apprentices completed the program, with
80% of those finding full-time roles at The Star.
Over the past 11 years, the program has
welcomed over 500 apprentices.
The success of SCI is highlighted by the
outstanding achievements of graduates at local
and international competitions, such as the
WorldSkills Australia National Championships
and the Queensland Tourism Industry Council
Salute to Excellence Awards.
In FY23, The Star continued to support the
National Indigenous Culinary Institute, a leading
organisation aimed at connecting aspiring
First Nations chefs with some of Australia’s
leading restaurants.
FOOD AND BEVERAGE SKILLS
In FY23, 1599 Food and Beverage team members
participated in various onboarding and training
sessions through The Star Academy. Of 79 team
members assessed, 71 were successful in moving
up a to a level 3 standard.
PEOPLE (CONTINUED)
THE STAR GRADUATE PROGRAM
Established in 2018, 57 tertiary-educated
graduates have been welcomed across the
Technical, Hospitality and Corporate programs.
In January 2023, a new cohort of nine graduates
was welcomed and in March 2023 the FY22
cohort held their graduation at The Star Gold
Coast. The Star Graduate Program has maintained
very high levels of employability and retention,
with 30 graduates who completed the program
securing full-time roles with the business.
34
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT COMMUNITY COMMITMENT
AND DEVELOPMENT
The Star prides itself in supporting a range
of charities, not-for profits and community
organisations in Brisbane, the Gold Coast
and Sydney.
GIVIT has continued as The Star’s National
Community Partner and we have worked together
collaboratively on several initiatives that support
both GIVIT directly and the 4,500 organisations
with which they partner.
In the 2023 financial year The Star continued its
support of GIVIT’s Spring Clean campaign by
donating the contents of The Star Sydney’s Darling
Hotel to NSW communities including to Resilient
Lismore and Rebuilding the Northern Rivers to
help flood-hit residents move back into their
homes. The furniture and household items were
also given to the Dr Steve Burroughs Foundation
for remote Indigenous First Nations communities.
At The Star Sydney, investment continued into
local community groups and events to play our
part in the Pyrmont community. In 2022 our food
and beverage teams volunteered their time at
the Christmas In Pyrmont festival to raise funds
for several local groups — Barnardos Yurungai
Learning Centre, Ultimo Public School Music
Program and the Uniting Harris Community
Centre Emergency Relief Program.
Additionally, The Star sponsored the Pyrmont
Food and Wine Festival working with the Pyrmont
Ultimo Chamber of Commerce to showcase the
best of NSW food, wine and local artists.
Treasury Brisbane’s landmark partnership with
The Royal National Agricultural and Industrial
Association of Queensland’s Royal Queensland
Beer and Wine Awards continued in 2022.
Treasury’s involvement with the Awards fosters
emerging talent in the Queensland craft brewing
and winemaking industry and supports those
companies that employ and nurture that talent.
Treasury also continued as the Presenting Partner
of The Brisbane Portrait Prize, a growing art
prize dedicated to celebrating Brisbane portrait
artists and their sitters, while encouraging
public engagement with the arts. In November
2022 The Star presented a Showcase of Portrait
Prize finalists at Ryan’s on the Park, using the
backdrop of the Treasury Brisbane Hotel to frame
10 portraits.
Treasury was also the home of one of the more
unlikely sights in the Brisbane CBD in January
2023. To support Queensland Fruit and Vegetable
Growers’ '100 years of horticulture' celebration
Queens Gardens was transformed overnight into
a pineapple farm. More than 2,000 pineapple
plants were placed in rows as a way of connecting
consumers to the food we eat and the farmers
who produce it.
35
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT PEOPLE (CONTINUED)
The Star Gold Coast was proud to again support
two icons of the Gold Coast: Surf Life Saving
Queensland and Currumbin Wildlife Hospital.
The Star Gold Coast continued to host, support
and mentor the Surf Woman of the Year Awards,
promoting women’s leadership and empowerment
across both the Gold Coast and Queensland.
The Star Gold Coast also hosted Currumbin
Wildlife Sanctuary’s 75th anniversary, raising vital
funds to help treat sick and injured animals as
well as supporting the Sanctuary and Hospital’s
owner, the National Trust Queensland, to
protect, conserve and celebrate Queensland’s
environmental, built, and cultural heritage.
The Star’s team members continued to support
charities, community groups, sporting clubs and
local schools through the 'Open Your Hearts'
employee giving program. Established in 2008,
it continues to be a popular way for hard-working
team members to show their appreciation to local
organisations that they care about and spend their
spare time supporting.
36
OTHER PARTNERSHIPS
Alongside numerous community,
charity and not-for-profit partnerships,
The Star is committed to supporting
events and programs that foster local
spirit and pride in the cities where team
members live and work.
The Star Sydney continued its strong
partnerships with sporting organisations and
cultural events important to the city, including
NSW Rugby League, Sydney FC, Australian
Turf Club thoroughbred race meets, including
The Star Championships and the showcase
event for the Sydney Spring Racing Carnival,
The Everest.
In Brisbane, The Star commenced a new
five-year partnership with The Brisbane
Broncos as a Premier Partner of the NRL
team as well as an Official Partner of the
club’s NRLW team.
The Star continued a partnership of more
than 16 years with the Brisbane Racing Club
through The Star Stradbroke Season, the most
prestigious mid-year event on Australia’s
thoroughbred racing calendar.
The Star was also proud to support
longstanding, iconic cultural events
The Brisbane Festival, The Lord Mayor’s
Christmas Carols and Queensland’s premier
fashion event, The Brisbane Fashion Festival.
With the aim to help drive tourism and
visitation outcomes to the region, The Star
Gold Coast continued with several showcase
events including as Naming Rights Partner of
the Gold Coast Magic Millions Carnival and
Raceday and the Gold Coast Women of the
Year Gala awards.
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT KEY PROJECTS
QUEEN’S WHARF BRISBANE
Anticipated to open progressively
from April 2024 and delivered by
Destination Brisbane Consortium,
Queen’s Wharf Brisbane is a $3.6
billion joint venture development
comprising The Star and its Hong
Kong based partners, Chow Tai Fook
Enterprises Limited and Far East
Consortium International Limited.
Concept image for illustrative purposes only.
Positioned to provide a wide range of
‘quintessentially Queensland’ experiences, and
significant economic benefits for the State and the
nation, the development merges state-of-the-art
contemporary architecture with heritage buildings
in an exciting new precinct that will embrace
Brisbane’s subtropical climate and outdoor
river-city lifestyle.
The 2023 financial year saw further milestones
reached for the development, including:
• Significant art commissions for the precinct:
• Being Swallowed by the Milky Way:
An 8-metre high, 8-tonne bronze sculpture by
internationally renowned artist Lindy Lee.
• Lungfish Dreamz: A supersized mosaic wall
mural of Australian lungfish by local artist
Samuel Tupou.
• A Cottage Year: A high-tech interactive digital
light installation for the heritage listed The
Printery Office by husband-and-wife team
Alinta Krauth and Jason Nelson.
• Sheila: A larger-than-life five tonne goddess-
like bronze sculpture by Justene Williams.
• Inhabitant: A 15-metre floating art garden
depicting native plants by exciting First
Nations artist Tony Albert.
• Destiny: A super structure of three mullets by
the late Indigenous artist Wukun Wanambi.
• The Neville Bonner Bridge touching down at
Queen’s Wharf Brisbane after two years of
construction.
• Continued restoration and repurposing
of heritage buildings including the former
Department of Primary Industry’s, The Printery,
and Harris Terraces.
• The handover of several dining, entertainment
and gaming areas on Levels 5 and 6 of the
integrated resort.
• The iconic Sky Deck was lifted into place on
23 July 2023 linking the hotel and residential
towers.
The Queen Wharf Brisbane development
will continue to take shape in FY24 including
construction, fit out works, and hand over in
relation to other areas prior to planned April 2024
progressive opening. The Star will continue to
operate Treasury Brisbane until the new integrated
resort opens and the transition to the new
casino occurs.
37
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT KEY PROJECTS (CONTINUED)
THE STAR GOLD COAST
The Star Gold Coast masterplan
continued to progress in FY23. After
Tower 1, showcasing a Dorsett hotel and
The Star Residences, opened in early
2022, the focus shifted to the ongoing
construction of Tower 2.
This $400 million, 65-storey mixed-use tower
being delivered by Destination Gold Coast
Consortium, a joint venture development
comprising The Star and its Hong Kong based
partners, Chow Tai Fook Enterprises Limited and
Far East Consortium International Limited, is well
advanced. It is due for completion in late 2024.
The tower, the second of five in the $2 billion-plus
masterplan for Broadbeach Island, will include:
• A five-star luxury lifestyle hotel.
• The second stage of The Star Residences.
• Additional restaurants, cafes, and
nightlife venues.
• A comprehensive pool deck with
complimentary amenities.
As approved by the Queensland Government in
November 2018, The Star Gold Coast’s masterplan
provides potential for a further three towers on
Broadbeach Island, as well as significant additional
resort facilities, dining precincts, bars and cafes,
and entertainment areas.
THE STAR SYDNEY
The 2023 financial year saw the delivery
of key projects, and the continuation of
significant milestones at The Star Sydney.
These included:
Refurbishment works at The Darling: Sydney’s
only Forbes five-star boutique hotel and urban
resort is continuing its current refurbishment. The
project is due for completion in the second half of
calendar year 2023.
Infrastructure and Back of House Projects:
The commencement and completion of key
infrastructure and back of house projects in
FY23 included:
• The upgrade of back of house staff amenities,
locker and changeroom facilities.
• The upgrade and refresh of The Star Station,
as part of the Sydney Light Rail Network.
38
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS’, REMUNERATION
AND FINANCIAL REPORT
DIRECTORS' REPORT
AUDITOR'S INDEPENDENCE DECLARATION
REMUNERATION REPORT
FINANCIAL REPORT
Consolidated Income Statement
Consolidated Balance Sheet
Consolidated Statement of Cash Flows
Consolidated Statement of Changes in Equity
Notes to The Financial Statements
DIRECTORS' DECLARATION
INDEPENDENT AUDITOR'S REPORT
PLEASE NOTE: The above page numbering is from the original Directors',
Remuneration and Financial Report released to the ASX on 29 August 2023.
1
26
27
46
46
47
48
49
50
105
106
39
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
THE STAR ENTERTAINMENT GROUP LIMITED
ACN 149 629 023
ASX Code: SGR
and its controlled entities
40
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
The Directors of The Star Entertainment Group Limited (the Company) submit their report for the consolidated entity
comprising the Company and its controlled entities (collectively referred to as the Group) in respect of the financial year
ended 30 June 2023.
1
DIRECTORS
The names and titles of the Company's Directors in office during the financial year ended 30 June 2023 and until the date of
this report are set out below. Directors were in office for this entire period unless otherwise stated.
Directors
David Foster a
Robbie Cooke b
Michael Issenberg c
Deborah Page AM d
Anne Ward e
Chairman and Non-Executive Director
Managing Director and Group Chief Executive Officer
Non-Executive Director
Non-Executive Director
Non-Executive Director
Former
Ben Heap f
Gerard Bradley AO g
Katie Lahey AM h
Richard Sheppard i
a
Chairman and Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Appointed as Chairman on 31 March 2023. Appointed as Non-Executive Director on 15 December 2022 following the receipt of all
necessary regulatory approvals.
Appointed as Group Chief Executive Officer on 17 October 2022 with regulatory approvals in NSW pending. Commenced as
Managing Director on 18 November 2022 following the receipt of all necessary regulatory approvals.
Appointed as Non-Executive Director on 11 July 2022 following the receipt of all necessary regulatory approvals.
Appointed as Non-Executive Director on 13 March 2023 following the receipt of all necessary regulatory approvals.
Appointed as Non-Executive Director on 18 November 2022 following the receipt of all necessary regulatory approvals.
Retired as Chairman and Non-Executive Director on 31 March 2023.
Retired as Non-Executive Director on 31 October 2022.
Retired as Non-Executive Director on 30 December 2022.
Retired as Non-Executive Director on 22 November 2022.
b
c
d
e
f
g
h
i
2
OPERATING AND FINANCIAL REVIEW
The Operating and Financial Review for the year ended 30 June 2023 has been designed to provide shareholders with a
clear and concise overview of the Group’s operations, financial position, business strategies and prospects. The review also
discusses the impact of key transactions and events that have taken place during the reporting period and material business
risks faced by the Group, to allow shareholders to make an informed assessment of the results and future prospects of the
Company. The review complements the Financial Report and has been prepared in accordance with the guidance set out in
ASIC’s Regulatory Guide 247.
2.1 PRINCIPAL ACTIVITIES
The principal activities of the Group are the management of entertainment and leisure destinations with gaming,
entertainment and hospitality services.
The Group operates The Star Sydney (SSyyddnneeyy), The Star Gold Coast (GGoolldd CCooaasstt) and Treasury Brisbane (BBrriissbbaannee). The
Group also manages the Gold Coast Convention and Exhibition Centre on behalf of the Queensland Government and invests
in a number of strategic joint ventures.
The Group owns Broadbeach Island on which The Star Gold Coast casino is located.
On 17 October 2022, the Group received written notice from the New South Wales Independent Casino Commission (the
NNIICCCC) under section 23(4)(a) of the Casino Control Act 1992 (NSW) (the AAcctt) that The Star Pty Limited (TThhee SSttaarr), being the
New South Wales (NNSSWW) casino licence holder and wholly owned subsidiary of the Group, has had its licence suspended
indefinitely, with effect from 9am on Friday, 21 October 2022.
Also effective from this date, the NICC appointed a Manager of the Sydney casino under section 28 of the Act. The Manager's
appointment, initially for a period of 90 days, was extended on 16 December 2022 by 12 months to 19 January 2024,
unless terminated earlier by the NICC.
1
1
41
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
On 9 December 2022, the Group received written notice from the Queensland Attorney-General, The Honourable Shannon
Fentiman MP and the Queensland regulator, the Office of Liquor and Gaming Regulation (OOLLGGRR), of the following disciplinary
action under section 31 of the Casino Control Act 1982 (Qld) in relation to its subsidiaries, The Star Entertainment QLD
Limited (the licensee of Treasury Brisbane) and lessee of The Star Gold Coast and The Star Entertainment QLD Custodian Pty
Ltd (the licensee of The Star Gold Coast):
The Treasury Brisbane and The Star Gold Coast casino licences are to be suspended for a period of 90 days on a
deferred basis with effect from 1 December 2023; and
A Special Manager has been appointed to monitor operations of Treasury Brisbane and The Star Gold Coast.
2.2 BUSINESS STRATEGIES
The Group is committed to delivering sustainable outcomes for guests, team members, shareholders and the communities
where it exists, by providing entertainment, gaming and leisure experiences in a safe, responsible and ethical way. This will
be done by finalising and embedding the company's new values to lead the organisation with a focus on safer gambling and
good business practices.
Key strategic priorities for the Group:
Remediation measures
Comprehensive and urgent focus on remediation actions including cultural transformation
Achieve suitability and have licence suspensions lifted; and
Repair and strengthen the Group's relationship with relevant regulators and other stakeholders.
Manage planned capital expenditure programs to deliver value and returns for shareholders; and
Identify, retain, develop and engage a highly talented team of employees across properties and the Group.
In FY24, management’s focus will be on the following key areas:
Operations
Prepare for the introduction of cashless and carded play;
Sustain the benefits of the recent cost reduction and operational initiatives;
Complete the refinancing of existing debt funding arrangements;
Complete the appointment of key executive roles; and
Manage the competitive impact in Sydney.
Major projects
Queen's Wharf Brisbane - complete construction, manage costs, prepare for the phased opening; and
Gold Coast - progress the construction of Tower 2.
Asset sales
Complete the sale of the Sheraton Grand Mirage Resort Gold Coast; and
Explore options for each of the Treasury Brisbane assets.
2.3 GROUP PERFORMANCE
The Bell and Gotterson Reports found the Group unsuitable to hold casino licences in NSW and Queensland. As a result, the
Sydney Casino licence was suspended indefinitely from 21 October 2022. A deferred licence suspension was announced for
the Queensland Casino licenses, effective from 1 December 2023 (for a period of 90 days) providing the Group an
opportunity to remediate its management and operations and return to a position of suitability. The NICC appointed a
Manager to manage the casino operations of The Star Sydney. The Queensland Attorney-General and OLGR announced the
appointment of a Special Manager to monitor the casino operations of the Queensland properties.
During the period of its licence suspension, The Star Sydney remains open and operating, and net earnings continue to be
paid to The Star after payment of the Manager’s costs. The Queensland casinos pay the costs of the Special Manager and
remain open and operating.
2
42
2
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
During FY23 the remediation focus was to uplift in high-risk areas of the casinos' operations and to address priorities
communicated to the Group by the Manager of The Star Sydney casino. The uplifts included improvements to Financial Crime
management, and implementation of Internal Controls Manuals (ICMs) in both states. The Group also commissioned a Root
Cause Analysis by Deloitte to inform the remediation program, and is developing a culture renewal road-map following an
external review undertaken by The Ethics Centre. Managerial appointments have been made in key risk areas, the Legal and
Risk functions have been split, and Board renewal has materially progressed. A comprehensive draft remediation plan has
also been formally submitted for review in both NSW and Queensland.
The Group takes its obligations seriously and considers the ability to hold a casino licence as a privilege. The Board and
senior management are learning from the lessons of the past, acknowledge the gravity of the conduct raised in the Bell and
Gotterson Reports, and accept that the Group did not live up to the trust placed in it by the people of NSW and Queensland.
The Group is absolutely focused on improving and returning to suitability in NSW and Queensland.
The Group started FY23 positively. COVID-19 restrictions began easing in late 2H FY22, allowing for the return to more
normal operating conditions. 1H FY23 saw a number of strong monthly revenue results, particularly in Gold Coast and
Brisbane, as the properties enjoyed strong domestic tourism and pent-up demand following the relaxing of COVID-19
enforced restrictions. However, conditions turned in Sydney and Gold Coast in 2H FY23. Factors impacting the operating
performance included: the implementation of uplifted controls, which necessarily resulted in increased exclusions; the
important uplifting of risk and compliance resourcing; the introduction of competition during the period in the Sydney table
games market; some operating restrictions impacting customer experience; and weaker consumer discretionary spending.
The prior comparative period (ppccpp) was materially impacted by COVID-19, with the Sydney property closed for 102 days, the
Queensland properties closed for up to 12 days each, and operating restrictions in place otherwise.
The Group recorded no International VIP Rebate activity in FY23 following the suspension of all international and domestic
rebate programs in May 2022 in response to the Bell Review.
Earnings before interest, tax, depreciation and amortisation (EEBBIITTDDAA) (excluding significant items) of $317.4 million was up
33.6% on the pcp. Statutory and normalised results for FY23 are consistent given there was no International VIP Rebate
business revenue.
Net revenue of $1,867.5 million was up 22.3% on the ppccpp. Domestic gaming revenue increased 17.4%, with growth in both
slots (19.7%) and tables (15.1%). Non-gaming revenue was also up 48.4%, buoyed by a strong domestic tourism market and
the return of conferencing events, particularly in Gold Coast. The properties started the period strongly, however results
softened in 2H due to the significant and rapid deterioration of operating performance.
Gaming taxes and levies of $456.1 million were up 20.3% on the pcp, in line with increased domestic gaming revenues. The
average tax rate increased during the year primarily due to the changes to the Casino Control Act 1992 (NSW) which tax slots
free play effective from 5 September 2022. Operating costs of $1,094.0 million were up 20.1% on the pcp. Increased costs
reflect the higher underlying activity levels across the properties and the step-up in remediation costs. Significant expense
items ($2,824.8 million before tax) relate to the impairment of The Star Sydney, The Star Gold Coast and Treasury Brisbane;
regulatory, fines, penalties, duty, consultants, legal and other costs; debt refinancing costs; redundancy costs; and software-
as-a-service implementation costs; partially offset by profit on sale of assets.
Depreciation and amortisation expense of $195.3 million was down 6.2% on pcp, primarily driven by the impairment of The
Star Sydney assets during the year. Finance costs of $56.5 million (excluding significant items) were up 12.5%, due to the
impact of the higher average cash rate (2.98% vs 0.18%) on the Group's variable rate debt, partially offset by lower average
debt balances from repayment of a portion of the debt following the capital raising in March 2023.
Net loss after tax was $2,435.2 million. Normalised1 net profit after tax, excluding significant items, was $41.3 million. Basic
and Diluted Loss per Share were both 211.7 cents (both 21.3 cents in the pcp).
2.4 GROUP FINANCIAL POSITION
No final dividend was declared, in accordance with the conditions of debt covenant waivers which restrict further cash
dividends from being paid until the Group’s gearing, which represents the ratio of net debt to 12 month trailing statutory
EBITDA, is below 2.5 times, the Group returns to suitability and all the Group’s casino licences are in full force and effect.
Net debt2 was $595.5 million (30 June 2022: $1,149.0 million). In March 2023, the Group finalised an $800.0 million equity
raising, including a $685.0 million 3 for 5 pro rata accelerated non-renounceable entitlement offer and a $115.0 million
institutional placement. Net proceeds of $778.5 million includes $21.5 million of costs capitalised against equity. Net
proceeds were used to repay $210.2 million (US$162.8 million) of USPP (approximately 40.0%) and $546.1 million of
bilateral facilities, of which $338.0 million in facilities were closed (approximately 30%). In conjunction with the repayment of
USPP, $20.5 million in cross currency interest rate swap assets were settled. The Group repaid net $603.1 million of debt,
primarily driven by the $800.0 million capital raising completed in March 2023, partially offset by $120.0 million of fines paid
to NICC and OLGR. Operating cash flow before interest and tax was $63.0 million (30 June 2022: $181.3 million).
1 The Group recorded no International VIP Rebate revenue in FY23 following the suspension of all international rebate programs in May 2022 in response to the
Bell Review. Consequently, in FY23, normalised earnings exclude significant items only. In the pcp normalised results reflect the underlying performance of the
business as they remove the inherent win rate volatility of the International VIP Rebate business. Normalised results are adjusted using an average win rate of
1.35% on turnover, taxes and revenue share commissions up to the suspension of rebate play in May 2022. It does not include adjustments to doubtful debts.
2 Net debt is shown as interest bearing liabilities (excluding lease liabilities), less cash and cash equivalents, less net position of derivative financial instruments.
3
3
43
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
The Sydney and Gold Coast cash generating units experienced a significant and rapid deterioration in operating performance.
The implementation of uplifted controls, which necessarily resulted in increased exclusions; the important uplifting of risk
and compliance resourcing; the introduction of competition during the period in the Sydney table games market; some
operating restrictions impacting customer experience; and weaker consumer discretionary spending have all impacted
operating performance. Significant uncertainty remains around the quantum and timing of penalties in relation to AUSTRAC
and the quantum (if any) in relation to the possible outcome of the four class actions. In Sydney, changes to NSW casino duty
rates will be implemented on a staged basis, commencing from 1 July 2023. In Brisbane, it is considered probable that the
operating and economic conditions affecting Sydney and Gold Coast will impact on the future earnings of The Star Brisbane
casino.
In combination, these factors have reduced the valuation of the cash generating units, requiring an impairment of $2,167.8
million (Sydney $1,583.1 million, Gold Coast $450.3 million and Brisbane $134.4 million) to be recognised for the year
ended 30 June 2023 (2022: $162.5 million). The impairment is recognised in the line ‘Depreciation, amortisation and
impairment expense’ in the Consolidated Income Statement. The impairment was first allocated against each cash
generating unit’s goodwill balance ($1,150.9 million) and then apportioned between property, plant and equipment ($817.9
million), intangibles ($184.3 million) and other non-current assets ($14.7 million).
On the Gold Coast, construction of the Gold Coast second tower (Tower 2), a $400 million 63-storey mixed use tower has
progressed to level 30, with opening targeted for late CY24. All 450 residential apartments have been pre-sold. Capital works
will be funded by partner contributions along with new debt facilities. Upon completion of Tower 2, The Star Gold Coast will
have in excess of 2,000 hotel rooms and apartments on the island. The Dorsett Gold Coast Hotel, located within the Gold
Coast first tower (Tower 1), opened on 26 December 2021 and continues to perform well. The final 75 apartments in Tower 1
settled during the year, and the Group received distributions of $20.2 million for its portion of the total related gain. On 26
June 2023, the contract for sale of the Sheraton Grand Mirage was executed. Settlement is expected in September 2023,
following satisfaction of conditions precedent, for a sale price of $192.0 million. The Group expects to net approximately
$60.0 million in funds from the sale.
In Brisbane, Destination Brisbane Consortium (DDBBCC)’s development of Queen's Wharf Brisbane (QQWWBB) is continuing. In July
2023, the final section of the SkyDeck was lifted into place. Other significant milestones achieved during the year include
topping out of The Star Grand Hotel, receipt of keys to several dining, entertainment and gaming areas on levels 5 and 6,
progress on the restoration and repurposing of the heritage buildings and completion of the Neville Bonner bridge. The
phased opening of QWB is expected from April 2024.
In Sydney, The Darling Hotel, Sydney’s only Forbes five-star hotel, had refurbishment works completed in August 2023. Staff
amenity upgrades were also completed, including back-of-house amenities, lockers and changeroom facilities. Finally, The
Star Station on the Sydney Light Rail Network underwent an upgrade and refresh.
2.5 SEGMENT OPERATIONS
The Group comprises the following three operating segments: Sydney; Gold Coast; and Brisbane.
Refer to note A1 for more details of the financial performance of the Company’s operating segments. The activities and
drivers of the results for these operations are discussed below.
SSyyddnneeyy
Net revenue was $984.0 million, up 26.5% on the pcp and EBITDA (excluding significant items) was $127.2 million, up
52.5% on the pcp. Performance was adversely impacted by the implementation of uplifted controls, which necessarily
resulted in increased exclusions; the important uplifting of risk and compliance resourcing; the introduction of competition
during the period in the Sydney table games market; some operating restrictions impacting customer experience; and weaker
consumer discretionary spending. The pcp was significantly affected by COVID-19 restrictions, with the property closed for
102 days and various operating restrictions enforced otherwise.
GGoolldd CCooaasstt
Net revenue was $508.9 million, up 20.2% on the pcp and EBITDA (excluding significant items) was $107.0 million, up
19.8% on the pcp. Domestic gaming revenue was up 8.1%. Gold Coast started the year strongly, with a number of record
monthly revenue results. This was largely due to a surge in domestic tourism and consumer spend in the wake of relaxed
COVID-19 restrictions. Performance declined in 2H due to the implementation of uplifted controls which necessarily resulted
in increased exclusions; the important uplifting of risk and compliance resourcing; the rebound of outbound travel which
competed with domestic tourism; and weaker consumer discretionary spending. Non-gaming revenue was up 51.7%,
attributed to a strong presence in the local market, additional on-property hotel rooms, return of conferencing events and
recently refreshed amenities. Gaming taxes and levies and operating expenses were up 7.9% and 24.4% respectively, in line
with the increase in gaming revenue, general activity levels and the step-up in remediation costs.
4
44
4
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
BBrriissbbaannee
Net revenue was $374.6 million, up 14.9% on the pcp and EBITDA (excluding significant items) was $83.2 million, up 28.4%
on the pcp. Brisbane started the year strong, with a number of record months of revenue, before a slight slowdown in the
second half. Gaming taxes and levies were up 12.3%, in line with domestic gaming revenue growth, while operating expenses
were up 11.3%, reflecting higher activity levels and a step-up in remediation costs.
IInntteerrnnaattiioonnaall VVIIPP rreebbaattee bbuussiinneessss
The Group recorded no International VIP Rebate revenue in FY23 following the suspension of all international rebate
programs in May 2022 in response to the Bell Review. The results of the International VIP Rebate business in the pcp are
embedded in the segment performance overviews above, however remained immaterial due to border closures (prior to its
suspension in May 2022).
2.6 SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS, REGULATORY MATTERS AND FUTURE DEVELOPMENTS
AAUUSSTTRRAACC cciivviill pprroocceeeeddiinnggss
As announced on 7 June 2021, and 14 January 2022, entities within the Group were the subject of an AUSTRAC
enforcement investigation. This followed potential non-compliance concerns identified in the course of a compliance
assessment which was commenced by AUSTRAC in September 2019.
On 30 November 2022 The Star Pty Limited and The Star Entertainment QLD Limited (collectively TThhee SSttaarr EEnnttiittiieess), were
served with a statement of claim from AUSTRAC, commencing Federal Court civil penalty proceedings in relation to alleged
contraventions of obligations under the Anti-Money Laundering and Counter Terrorism Financing (AML/ CTF) Act 2006. The
claims include that The Star Entities:
1. Failed to appropriately assess the money laundering and terrorism financing risks.
2. Did not include in their AML/CTF programs appropriate risk-based systems and controls to mitigate and manage risks.
3. Failed to establish an appropriate framework for Board and senior management oversight of the AML/CTF programs.
4. Did not have a transaction monitoring program to monitor transactions and identify suspicious activity that was
appropriately risk-based or appropriate to the nature, size and complexity of The Star Entities.
5. Did not have an appropriate enhanced customer due diligence program to carry out additional checks on higher risk
customers.
6. Did not conduct appropriate ongoing customer due diligence on a range of customers who presented higher money
laundering risks 1,189 times in New South Wales and 325 times in Queensland.
The parties are working towards the preparation of a Statement of Agreed Facts and Admissions (SSAAFFAA). At the case
management hearing on 14 July 2023, the Court ordered that the final SAFA be filed by 1 November 2023.
AUSTRAC has commenced civil penalty proceedings against other companies on five occasions, one of which is yet to
conclude. The four concluded AUSTRAC proceedings to date have led to the Federal Court approving and / or ordering the
respondent to pay significant penalties (Tabcorp $45 million (2017); CBA $700 million (2018); Westpac $1.3 billion (2020)
and most recently, Crown $450 million (2023)). The determination of the Federal Court’s penalty (including where a penalty
has been jointly proposed by AUSTRAC and the defendant to the Court) is specific to the facts of each case and arrived at
after consideration of the SAFA and evidence and submissions in relation to the appropriateness of the penalty.
The Statement of Claim from AUSTRAC alleges that the number of breaches committed by The Star Entities is innumerable.
Following a review of the Statement of Claim, and an analysis of the penalties against other companies (described above),
the relative size of the Group and capacity to pay, the Group has determined an appropriate provision on the balance sheet
as at 30 June 2023. This provision was and is recognised at a time where there remains considerable uncertainty on the
approach the Federal Court will ultimately take when approving any agreed penalty and where The Star Entities continue to
engage with AUSTRAC and the Australian Government Solicitor in relation to remediation activities designed to address
allegations of ongoing deficiencies in The Star Entities’ AML/Program. Any actual penalty paid by the Group may differ
materially to the provision recorded at 30 June 2023.
5
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45
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
UUnnddeerrppaaiidd ccaassiinnoo dduuttyy
During the Bell review, concerns were raised regarding the characterisation of residency for rebate patrons and the potential
consequences for the Group’s calculations of rebate duty payable to the NSW Government. As a result, the Group undertook
an independent assessment of residency status and consequential rebate gaming activity for a number of patrons that had
changed their residency status from ordinarily resident in New South Wales to being ordinarily resident interstate or overseas
between 28 November 2016 to May 2022.
The Bell report recommended the NSW Independent Casino Commission (NNIICCCC) engage an independent expert to perform
their own audit of all patrons that engaged in rebate play at The Star Sydney since 28 November 2016 and a clear and
objective test regarding the residency of players be included in The Star Sydney’s Duty Agreement.
The Group is working with NSW Liquor and Gaming to agree the scope of an independent review applicable to rebate play for
all patrons. The Group has also commenced working with the NICC and Treasury to develop a clear and objective test for the
residency of players. Such a test will require an amendment to The Star Sydney’s Duty agreement and result in changes to
relevant internal controls.
The Group has determined an appropriate provision on the balance sheet at 30 June 2023 of the potential impact of the
review of rebate play for all patrons. The final quantum of casino duty may be materially different to the amount provided as
it is subject to further analysis and discussions with the NICC and NSW Treasury.
AASSIICC cciivviill ppeennaallttyy pprroocceeeeddiinnggss aaggaaiinnsstt ffoorrmmeerr ddiirreeccttoorrss aanndd ooffffiicceerrss ooff tthhee CCoommppaannyy
In December 2022, the Australian Securities and Investment Commission (AASSIICC) commenced civil penalty proceedings in the
Federal Court of Australia against 11 former directors and officers of the Company alleging contraventions of their duties
under s180(1) of the Corporations Act 2001 (Cth). The alleged contraventions arise from certain matters considered in the
Bell and Gotterson Reviews.
As no entity of the Group is party to these proceedings, it is not possible to predict the timing and any financial impact of
these claims on the Group (including in terms of the Group bearing costs for the defendants, or the extent to which those
costs might be covered by available insurances and indemnities in place for previous officers and directors).
The Group provided for an estimate of legal costs as at 30 June 2023.
CCllaassss aaccttiioonnss
On 30 March 2022, 7 November 2022 and 3 and 6 February 2023, the Company was served by Slater & Gordon, Maurice
Blackburn, Phi Finney McDonald and Shine Lawyers respectively with separate statements of claim for securities class
actions in the Supreme Court of Victoria.
The claims are substantially similar and allege the Group failed to comply with continuous disclosure requirements and
engaged in misleading or deceptive conduct between 2016 and 2022 through various alleged disclosures or nondisclosures
about its systems, controls, operations and regulatory risks. The allegations reference the Bell review and previous media
reporting.
On 27 and 28 June 2023, the Court heard carriage and costs order applications from each of the four plaintiff law firms.
Judgment has been reserved in relation to which plaintiff firm will have carriage of the proceedings and the terms of any
relevant group costs order.
The Company intends to defend the proceedings.
The outcome and any potential financial impacts are unknown, including the extent to which any costs might be covered by
the Group’s insurance policies.
GGSSTT aammeennddeedd aasssseessssmmeennttss
On 11 August 2021 the Group received amended assessments from the Australian Taxation Office (AATTOO) in respect of a
dispute for the period October 2013 to August 2017 (inclusive) in relation to the GST treatment of rebates paid to junket
operators for The Star Pty Limited. The amount in dispute for this period is approximately $143.8 million (primary tax of
$81.9 million and interest of $61.9 million). In FY22 the Group paid $40.9 million as a deposit to the ATO on a no-admissions
basis. The deposit is held as a current asset on the balance sheet.
On 6 September 2021 the Group filed an application for judicial review with the Federal Court in relation to the interest
assessment and on 5 October 2021 lodged an objection against the primary assessments with the ATO. The matter has been
adjourned until the outcome of the objections, which is yet to be decided. The Group considers that it has paid the correct
amount of tax and will pursue all available avenues of objection.
WWiitthhhhoollddiinngg ttaaxx ppeennaallttyy
The ATO has issued a penalty for $6.4 million in relation to a dispute over the appropriate method for calculating withholding
tax on Junket rebates for the 2015 to 2020 income tax years. The Group has objected to the ATO’s decision to issue the
penalty, consequently the ATO is conducting an internal review of this matter. The objection is yet to be decided.
The Group considers that it has paid the correct amount of tax and will pursue all available avenues of objection.
6
6
46
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
NNEEWW SSOOUUTTHH WWAALLEESS
RReegguullaattoorryy rreeffoorrmmss
On 11 August 2022 the Casino Legislation Amendment Act 2022 (NSW) was enacted to give effect to amendments to the
Casino Control Act 1992 (NSW). These amendments enacted reforms to the NSW casino regulatory framework, including to
address the recommendations of the Bergin Inquiry and certain additional measures and to establish the NICC as a new
independent regulator. The reforms also purported to override compensation rights previously available to the Group for
specified regulatory changes. The amendments were effective from 5 September 2022 with the exception of compulsory
carded play and cash play limits, which commence on 11 August 2024 (unless an earlier date is set by Government). The
amendments include expanding the definition of gaming revenue to include slots free play.
BBeellll rreeppoorrtt
The Bell Report was provided to the Independent Liquor and Gaming Authority (ILGA) on 31 August 2022 and published by
the NICC on 13 September 2022. Mr Bell made a total of 30 recommendations and found The Star unsuitable to hold a
casino licence in NSW.
DDiisscciipplliinnaarryy aaccttiioonn
After considering the Bell Report recommendations and The Star’s response to the show cause notice issued on 13
September 2022, the NICC issued a $100 million fine (payable in 3 instalments on 31 March 2023, 30 June 2023 and 29
December 2023), suspended The Star’s casino licence and appointed a Manager for the Sydney casino. The Manager was
appointed initially for 90 days, however on 16 December 2022 this was extended to 19 January 2024.
The final instalment for the pecuniary penalty has been recorded as a liability on the balance sheet at 30 June 2023.
The Star Sydney remains open and operating, and net earnings continue to be paid to The Star after payment of the
Manager’s costs. The Manager has assumed the responsibility and control of The Star’s casino operations.
CCaassiinnoo dduuttyy rreeffoorrmmss
On 11 August 2023 the NSW Treasurer and the Group announced an in-principle agreement had been reached in relation to
changes to casino duty rates for casinos in New South Wales and their impact on The Star Sydney. The in-principle
agreement supersedes the proposal announced by the previous Liberal NSW Treasurer on 17 December 2022. Once
formalised the amendments announced are designed to deliver a sustainable outcome for The Star Sydney and to protect
the jobs of thousands of NSW team members.
The changes include rate increases for rebate duty (10% to 12.5%) and Table Games (17.91% to 20.25%) from 1 July 2023.
Poker Machine duty rates will remain unchanged until 2030 (currently 20.91%, 21.91% from 1 July 2024 and 22.91% from
1 July 2027). From 1 July 2030 poker machines will be taxed based on average poker machine revenue using a progressive
rate scale with a maximum of 51.6%. In the period 1 July 2023 to 30 June 2030 an additional levy will apply equal to 35% of
The Star Sydney’s gaming revenue above $1.125 billion per financial year. There is no change to the Responsible Gambling
Levy rate.
Further, the in-principle agreement includes a jobs agreement that provides employment certainty for team members in
arrangements agreed with the United Workers Union. The Star Sydney will also introduce a trial of its cashless gaming
machine technology in October 2023 on 50 gaming machines and 8 gaming tables.
7
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47
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
QQUUEEEENNSSLLAANNDD
RReegguullaattoorryy rreeffoorrmmss
On 14 October 2022 the Casino Control and Other Legislation Amendment Bill 2022 (Qld) was passed by the Queensland
Parliament. The legislative amendments to the Casino Control Act 1982 (Qld) included increasing the maximum pecuniary
penalty to $100 million, allowing for the appointment of a Special Manager and overriding compensation rights previously
available to the Group for specified regulatory changes.
GGootttteerrssoonn RReeppoorrtt
In July 2022 an independent review commenced of the Group’s Queensland casinos, The Star Gold Coast and Treasury
Brisbane.
The Attorney-General appointed the Honourable Robert Gotterson AO, to examine whether these casinos operate in a way
that is consistent with achieving the objectives of the Casino Control Act 1982 (Qld) and the ongoing suitability of the Group’s
casino licensees. The Gotterson Report was publicly released on 6 October 2022, making 12 recommendations, which have
been accepted in-principle by the Queensland Government. On 25 October 2022 the Attorney-General formally determined
that the Group’s Queensland casino licensees, and other associated entities of The Star Entertainment Group, were not
suitable to be associated or connected with the management and operations of a hotel-casino complex or casino in
Queensland, by reason of it not being a person of good repute.
Further amendments to the Casino Control Act 1982 (Qld) are expected in 2023 to enact the remaining recommendations
from the Gotterson Report, including mandatory carded play and cash limits and mandatory player pre-commitments.
DDiisscciipplliinnaarryy aaccttiioonn
On 9 December 2022 the Attorney-General announced a total penalty of $100 million in relation to the Group’s Queensland
casinos (payable in three instalments on 31 March 2023, 30 June 2023 and 31 December 2023); suspended the Group’s
Queensland casino licences for a period of 90 days on a deferred basis with effect from 1 December 2023 unless postponed
or rescinded due to satisfactory progress towards suitability, and appointed a Special Manager to monitor the operations of
the Group’s Queensland casinos.
The final instalment for the pecuniary penalty has been recorded as a liability on the balance sheet at 30 June 2023.
FFUUTTUURREE DDEEVVEELLOOPPMMEENNTTSS
Future developments in the Group's activities will be dependent on several factors outlined in this report, notably the
successful refinance of debt facilities, resolution of the AUSTRAC civil proceedings, and timely execution of the extensive
program of remediation activities necessary for a return to suitability in both NSW and Queensland.
There were no other significant changes in the state of affairs of the Group during the financial year.
8
48
8
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
2.7 RISK MANAGEMENT
The Group takes a structured approach to identifying, evaluating and managing those current and emerging risks which have
the potential to affect achievement of strategic objectives. The commentary relating to Principle 7 in the Company’s
Corporate Governance Statement describes the Group’s risk management framework which is based on ISO31000, the
international standard on risk management. The Corporate Governance Statement can be viewed on the Company’s website.
Details of the Group’s material risks and associated mitigation strategies are set out below. The mitigation strategies are
designed to reduce the likelihood of the risk occurring and/or to minimise the adverse consequences of the risk should it
happen. However, some risks are affected by factors external to, and beyond the control of, the Group.
RRiisskk aanndd ddeessccrriippttiioonn
Mitigation strategy
SSuuiittaabbiilliittyy
The Company and the Group's operations are
regulated by laws, licences, permits and approvals
from relevant government agencies and regulators.
The Company is developing a comprehensive remediation program
which seeks
the Group’s governance,
accountability and capabilities, culture and risk and compliance
processes to meet suitability requirements for a casino operator in the
States in which it operates.
to uplift and
reform
The failure of one or more of the relevant Group
entities for The Star Sydney, The Star Gold Coast or
Treasury Brisbane to be suitable, or return to
suitability, to hold a casino licence or meet relevant
suitability requirements could have an impact on
The Remediation Plan will be multi-year in nature and will require
the Group's reputation, financial performance and
significant financial and human resources to deliver.
position and the ongoing operation of the business.
A draft Remediation Plan is currently under review by the relevant
regulators, and is subject to their approval.
the Group
respectively,
Following the Bell and Gotterson reviews in NSW
and Queensland,
is
presently operating with a suspended licence in
NSW and a licence which is subject to deferred
suspension in Queensland.
SSaaffeerr GGaammbblliinngg
The Company recognises the failure to deliver and
support responsible gambling practices as a
material risk for the Group’s business operations.
The Group seeks to provide a safe gambling
gambling and
environment where problem
gambling related harm are minimised.
Through the remediation program the culture of Safer Gambling will be
embedded in the Group’s business strategy, processes, and individual
accountabilities.
Resourcing dedicated to Safer Gambling monitoring and guest welfare
has nearly doubled during FY23, with further increases being actioned
in FY24.
Failure to provide a Safer Gambling environment at
impact the Group’s
each of
its venues may
licences and result
suitability to hold casino
(including following self-reporting)
in significant
fines or other penalties or sanctions, which in turn
may have an adverse impact on the Group’s
reputation, suitability to hold one or more casino
licences, and financial performance and position.
The Bell and Gotterson reviews are examples of
this.
Analytics is used to detect patterns, modes and durations of play
which may be indicators of gambling harm. These efforts will be
improved when fully carded play becomes effective in CY24.
Failure to provide a Safer Gambling environment
may also increase customer dissatisfaction, which
could result in compensatory claims, leading to an
adverse
financial
performance and position.
the Group’s
impact on
9
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49
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
RRiisskk aanndd ddeessccrriippttiioonn
Mitigation strategy
AAnnttii--MMoonneeyy LLaauunnddeerriinngg aanndd CCoouunntteerr--TTeerrrroorriissmm
FFiinnaanncciinngg ((AAMMLL//CCTTFF CCoommpplliiaannccee))
The Group operates in an industry that presents
high money laundering risks.
AML risks are actively managed and the Group’s AML/CTF framework
is continuing to be enhanced. Development and delivery of the
Group’s remediation program is expected to further enhance AML risk
awareness and AML controls across the Group, embed and strengthen
new processes and controls, while also providing greater visibility of
control effectiveness.
As a provider of ‘designated services’ under the
Anti-Money Laundering and Counter-Terrorism
Financing Act 2006 (Cth) (AML/CTF Act), some
entities within the Group are ‘reporting entities’
which are subject to obligations under the AML/CTF
Act and Anti-Money Laundering and Counter-
Terrorism Financing Rules Instrument 2007 (No. 1).
The Group has dedicated regulatory and compliance teams and a
specialist AML/CTF team that is continuing to invest and enhance the
Group’s AML/CTF risk management capabilities, including through
dedicated IT systems development.
A failure to comply with these obligations may
expose the Group to significant penalties or other
regulatory actions.
AUSTRAC has commenced civil penalty proceedings
against
the Group, alleging wide-spread non-
compliance with the AML / CTF Act and Rules.
During FY23, an additional 70 FTE (approx.) have been employed to
support the AML/CTF team and The Group’s AML/CTF framework. This
incremental capacity has undertaken remediation activity, improved
transaction monitoring controls, introduced screening processes,
expanded guest data collection and verification processes, improved
governance and risk assessment capabilities and delivered updated
training for Group personnel.
The outcome of AUSTRAC’s action against the
Group is unknown, but may result in a material
penalty which may have a significant negative
impact on the Group’s financial position.
The Group seeks to build collaborative, transparent and constructive
relationships with financial crime regulators, keeping abreast of
emerging risks and trends, and actively participating in industry,
regulatory and law- enforcement initiatives.
LLeeggaall aanndd RReegguullaattoorryy CCoommpplliiaannccee
The Group operates in a highly regulated industry
and
is reliant on receiving and maintaining
regulatory approvals in the jurisdictions in which it
conducts gaming and non-gaming operations.
The Group’s remediation program is being designed to further develop
and enhance the Group’s governance and compliance frameworks
and processes.
Legislative and regulatory changes or decisions
affecting the operation of casinos (including the
potential effect of changes in the administration of
laws in foreign countries affecting the ability of
foreign nationals to travel to and/or bring funds to
Australia) may have an adverse impact on the
operations, financial performance and position of
the Group.
failure
Similarly,
in-principle
to conclude
agreement over changes in casino duty rates in
NSW, as announced by the NSW Treasurer, may
have negative consequences for the financial
performance and position of the Group.
the
for potential
The Group continuously monitors
legislative and
regulatory changes or changes in relevant government policy and
positions in the States in which it operates. This includes matters core
to the integrity of gaming operations such as gaming regulatory
compliance, Safer Gambling, service of alcohol and AML/CTF
compliance.
The Group works collaboratively with State and Federal regulatory
authorities to ensure that applicable laws and regulations are properly
interpreted and applied. The Group works with these authorities and
other stakeholders in relation to anticipated or proposed legislative or
regulatory changes or decisions.
10
50
10
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
RRiisskk aanndd ddeessccrriippttiioonn
Mitigation strategy
LLeeggiissllaattiivvee && CCoonnttrraaccttuuaall RReessttrriiccttiioonnss oonn DDeeaalliinngg
wwiitthh AAsssseettss
Beyond the current regulatory issues applying to
the Group’s operations in NSW and Qld (including
the manager appointments), there are various
restrictions arising under state-based legislation
and various contractual arrangements which apply
to the casino licences and associated assets which
comprise the Group’s operations.
These arrangements restrict certain dealings in the
relevant assets, such that the relevant assets
cannot be assigned or mortgaged, charged or
otherwise encumbered, at least without relevant
consents or approvals being obtained (if applicable)
or at all.
These restrictions are a function of the legislative and contractual
obligations which apply to the Group’s operations in NSW and Qld.
The Group seeks to ensures that it consults with relevant regulatory
bodies and third parties in connection with such restrictions and
limitations as appropriate. Where applicable, relevant consents or
approvals are sought.
Certain assets are also subject to joint venture
arrangements and the financing arrangements
which apply to those joint ventures.
The inability of the Group to deal with these assets
in certain circumstances or obtain necessary
regulatory approvals or
legislative changes to
transact or finance these assets could negatively
impact
financial
the Group's operations and
position.
FFiinnaanncciiaall MMaannaaggeemmeenntt
The Group’s ongoing financial performance and
position is critical in order for the Group to be able
to access funding to meet current and anticipated
expenses, penalties and judgements and to fund
future growth opportunities on commercially
acceptable terms.
The Group continuously monitors
financing and capital
requirements and will seek to raise funds from either debt or equity
capital markets, debt financiers or otherwise, to support the Group’s
financial management needs, in each case, subject to such funding
being available on commercially acceptable terms. Professional
financiers are engaged to assist in complex financing requirements
when appropriate.
its
The Group is currently undertaking a refinance
process. The failure of this process to conclude
have material negative
successfully
implications for the Group’s operating and financial
position and performance.
could
Financial performance is continuously monitored for any variations
from annual financial budgets and market expectations.
11
11
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
RRiisskk aanndd ddeessccrriippttiioonn
Mitigation strategy
KKeeyy SSttaakkeehhoollddeerr RReellaattiioonnss
The Group may experience difficulties or be unable
to engage with key stakeholders proactively and
fairly.
Any deterioration of the Group’s relationships with
key stakeholders may have an adverse impact on
the Group’s operations and ‘social licence’ to
operate, which in turn could have an adverse
impact on the Group’s reputation and financial
performance and position.
Critical stakeholders for the Group are the financial
services companies that provide transactional
banking services.
If the Group is unable to
maintain or source transactional banking services
(including for new businesses such as The Star
impacts on
Brisbane) there may be negative
operational and financial performance.
CCoorrppoorraattee GGoovveerrnnaannccee
There may be potential adverse impacts for the
Group from a failure to maintain a strong and
effective governance structure which supports a
culture of
transparency, accountability, and
compliance.
The Group
is developing standard frameworks and processes,
including as contemplated by the remediation program, for engaging
with a variety of stakeholder groups to improve the quality and depth
of its relationships with, amongst other stakeholders, governments,
regulators, shareholders, customers, joint venture partners, lenders,
transactional banking providers, suppliers, employees, media and
unions.
The Group has also developed partnerships with local community
groups and charitable organisations.
During FY23 the Board composition was fully renewed and a new
Chairman appointed. In addition, a new Group CEO, Chief Financial
Officer, Chief Risk Officer, Chief Legal Officer and other senior
positions were also appointed, all with the intent of driving stronger
governance and a culture of transparency, accountability and
compliance.
The Group has established and is refining an integrated “3 lines of
accountability” model to identify and manage key risks and to provide
assurance that critical controls are effective in managing those risks.
This model is supported by the Group’s risk management framework.
Internal Audit has been expanded and strengthened with additional
resources and capacity. Reporting is to the Chair of the Board Audit
Committee.
CClliimmaattee CChhaannggee,, SSuussttaaiinnaabbiilliittyy && EEnnvviirroonnmmeennttaall
IImmppaacctt
The Group seeks to identify climate related risks
and opportunities (including, physical risks and
socioeconomic
reduce
environmental impacts and improve sustainability
performance across its operations.
report and
impacts),
The Group’s ESG strategy, “Responsible Business, Sustainable
Destinations” responds to the Group’s material ESG issues in addition
to existing policies and controls.
The Group has adopted the Task Force on Climate-related Financial
Disclosures’
reports
(TCFD) Framework Recommendations and
annually in alignment with the TCFD Framework.
Failure by The Group to effectively assess and
respond to these risks and opportunities, or to be
perceived as failing to do so, could adversely
impact the Group’s reputation which in turn could
adversely affect the Group’s financial performance.
12
52
Physical climate risk assessments are conducted every two years.
The Group has set targets for net zero Scope 1 and Scope 2 carbon
emissions for its wholly owned and operated assets, is implementing
its Decarbonisation Plan and has set resource reduction targets.
Sustainability and environmental impact matters are reported to the
Safer Gambling, Governance and Ethics Committee.
12
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
RRiisskk aanndd ddeessccrriippttiioonn
Mitigation strategy
CCuullttuurree
The Group recognises that a risk-aware culture,
where team members are willing and unafraid to
escalate matters, is necessary to the effective
operation of its business.
The Group has expended significant effort to understand the Group’s
culture through an independent assessment, finalised at the end of
FY23. The learnings from this assessment are driving activities
through the Group’s remediation program.
Failure to operate with such a constructive culture
consistently across the Group’s operations could
result in a failure to identify, raise and escalate
incidents, breaches, operational and other matters
that could negatively impact the operational and
financial performance of the Group.
A program to promote safe escalation of incidents, issues, breaches
and other matters, “Raise It”, was launched Q4 FY23 and continues to
be the basis for driving momentum in the year ahead.
An independent and confidential whistleblowing program is in place to
support escalation when team members may not be comfortable
escalating through internal channels.
As a result of a failure to escalate matters, a weak
culture could also negatively impact the Group’s
reputation, regulatory relationships, the Group’s
return to suitability and ability to hold casino
licences in the states in which the Group operates.
PPeeooppllee
The Group may experience levels of high turnover in
its workforce,
reduction
initiatives, and may experience difficulty attracting,
recruiting and retaining appropriately qualified staff
– including for key leadership and operational
roles.
from cost
including
Specific to the Queen’s Wharf development, the
opening of The Star Brisbane will require a
substantial increase in headcount. The inability to
attract the right talent ahead of opening may
impact
financial
the Group’s operations and
performance.
Relationships with unions may not always be
constructive and supportive, leading to challenging
working environments and potentially, disruptions
to business operations.
People are critical to the effective operation of the
Group’s business. Negative developments that
impact the Group’s workforce may have an impact
financial
on
performance.
operations and
the Group’s
The Group has implemented a Diversity and Inclusion Program and
talent acquisition and retention programs and has invested in other
strategic initiatives such as The Star Academy to attract, recruit and
develop high performing and high potential employees.
The Group undertakes training and development programs to provide
employees with career development opportunities. The Group has also
moved to ‘continuous listening’ employee engagement surveys to
monitor for emerging issues which might affect the ability to retain
talented employees and enable actions in response.
The Group holds a constructive relationship with unions through
structured engagement from Senior Leadership to Front line team
members with a transparent and consultative approach. Our National
Deed of Agreement with United Workers Union and property Enterprise
Agreements provide a base line governance for our ways of working.
The remediation program is being designed to uplift capabilities in
people and culture across the Group.
HHeeaalltthh && SSaaffeettyy
The Company seeks to operate the Group’s
facilities without affecting the safety, security and
team members and
wellbeing of
contractors.
its guests,
There may be adverse impacts for the productivity,
operations and reputation of the Group if a guest,
team member or contractor is injured or some
other event or circumstance occurs in relation to
their safety, security and wellbeing, at one of the
Group’s premises. This may also
impact the
financial performance of the Group.
The Group takes a risk-based approach to managing health and
safety. Dedicated health and safety and
injury management
specialists are employed at each of the Group’s properties. Each
property employs security and surveillance personnel to provide
support in monitoring threats and managing potential incidents on a
real time basis.
13
13
53
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
RRiisskk aanndd ddeessccrriippttiioonn
Mitigation strategy
OOppeerraattiioonnaall RRiisskkss
The Group faces operational risks in its day-to-day
activities and processes. This includes risk of loss
failed
resulting
internal processes, people or systems (including,
amongst other things, technology, innovation, data
storage, staffing levels and skills, and information
security systems), or from external events.
inadequate, changed or
from
Though controls are in place, these may not always
be effective at mitigating unexpected internal or
external events which may adversely impact the
Group’s operational and financial performance.
CCyybbeerr SSeeccuurriittyy,, IInnffoorrmmaattiioonn SSyysstteemmss && PPrriivvaaccyy
The Group seeks to protect confidential business or
customer data which is collected, used, stored, and
disposed of in the course of the Group’s business
operations, including from a leak or unauthorised
access or use.
Measures have been taken over FY23 to enhance the Group’s
operational controls. Risk management capability across the Group is
being enhanced, with additional resourcing for controls management
and expanded capability in a dedicated Risk Management function.
The remediation program includes clearly defined work streams
designed to simplify the control environment and identify any control
gaps. A culture of risk awareness and an entrenched ‘three-lines-of
accountability’ risk model is the Group’s objective. Assurance and
Audit capabilities are being improved, in addition to business risk
awareness.
The Group has a dedicated information technology (IT) security
function which tests and monitors technology systems to detect and
block viruses and other threats to the security of the Group’s data.
The IT function also continues to implement a cyber resilience plan.
Information systems applications and technology
are essential to maintaining effective operations.
Employees are regularly trained on the importance of maintaining
effective cyber security and data privacy processes.
Threats to information systems applications and
technology are continuously evolving and cyber
threats and the risk of attacks are increasing. Any
failure of the Group’s systems and processes could
things, business
in, amongst other
result
interruption, customer dissatisfaction,
legal or
regulatory breaches (including of privacy legislation)
and liability. This in turn could have an adverse
impact on the Group’s reputation and financial
performance.
TThhee SSttaarr BBrriissbbaannee // QQuueeeenn''ss WWhhaarrff PPrroojjeecctt
The Group,
through Destination Brisbane
Consortium, is committed to delivering the Queens
Wharf Project. Failure to realise the potential return
from the Group’s invested capital in the Queen’s
Wharf Project or The Star Brisbane, or a failure to
obtain the necessary licences or approvals to
operate the precinct, may have an adverse impact
on the Group’s reputation, financial performance
and position.
The Group,
through Destination Brisbane
Consortium is presently in dispute with the builder
is
of Queen’s Wharf, the outcome of which
uncertain. Legal proceedings associated with this
dispute are presently in the Supreme Court of
Queensland. There are potential negative impacts
on
financial
performance, arising from unexpected settlement
outcomes.
the Group’s
reputation
and
A dedicated Privacy team sits within the Risk Management function
and works closely with IT on data security matters.
The Group has an operational Readiness Team and structured
program in place to deliver a transition from Treasury to The Star
Brisbane.
Further, governance structures are in place to report progress and
risks to the Board and the Destination Brisbane Consortium Board and
relevant Committees.
The Group has dedicated resources supporting licensing requirements
and acting as points of contact with regulators in Queensland to
support timely approval of licence applications.
While the Group’s preference is to resolve disputes constructively
through established governance forums, legal resources are in place
to address escalated dispute proceedings.
Resulting from a number of factors, the opening of
The Star Brisbane has already been delayed to April
2024. There is no certainty that the opening will not
be further delayed, with negative impacts on the
reputation and financial performance of the Group.
14
54
14
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
RRiisskk aanndd ddeessccrriippttiioonn
RReeaalliissiinngg VVaalluuee ffrroomm CCaappiittaall PPrroojjeeccttss
There may be potential adverse impacts for the
Group from a failure to generate adequate returns
in capital
from the financial capital
projects.
invested
Mitigation strategy
The Group has a project management framework and has employed
experienced project managers to reduce the risk of delays in
completion and/or overruns in costs of capital projects and maintain
oversight of joint venture investments.
The Group markets and promotes its portfolio of facilities to seek to
achieve a level of customer patronage needed to deliver the expected
returns on investment.
CCoommppeettiittiivvee PPoossiittiioonn aanndd CCuussttoommeerr BBeehhaavviioouurr
There may be potential adverse impacts on the
Group’s financial performance and position from
increased competition in the Group’s key markets
in Sydney, Gold Coast and Brisbane.
Substantial investments have been made to develop new or improved
venue facilities in all key markets, and to improve customer service
capabilities of employees. Revenue sources have also been
diversified.
impact on
Further, any diminution in customer satisfaction,
loyalty or changes in customer behaviour may have
financial
an
performance and position of The Group. This
includes behavioural change arising from changed
business processes and controls.
the operating and
is
Monitoring
in place to track customer satisfaction. Change
management practices are employed with specialised communication
programs in place to support customers through business changes.
of
recent
Notably, the introduction of fully carded play at the
Group from August 2024 will have an unknown
impact on customer behaviour and may negatively
affect the Group's operating performance and
financial position.
PPoolliittiiccaall aanndd GGeenneerraall BBuussiinneessss aanndd EEccoonnoommiicc
CCoonnddiittiioonnss
In
global and domestic
light
macroeconomic events and political, economic and
business conditions, geopolitical risks (for example,
in Ukraine), natural disasters,
the conflict
inflationary pressures
to
energy prices and the tightened labour market) and
rising interest rates, Australia may continue to
experience economic variability and uncertainty
going forward. For example, in the second half of
FY23, the Group experienced a significant and
rapid deterioration of trading performance.
(including
increases
The Group works collaboratively with external stakeholders and
engages actively with governments in support of common objectives.
Dedicated resourcing is in place for this purpose.
The Group monitors the external economic environment and aims to
be responsive to economic challenges that may impact its customers,
its employees and its business.
These economic and geopolitical conditions have
had, and could in the future have, an adverse
impact on the Group’s operating and financial
position and performance.
15
15
55
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
2.8 ENVIRONMENTAL REGULATION AND PERFORMANCE
The Group is subject to the reporting requirements of the National Greenhouse and Energy Reporting Act 2007 (NNGGEERR AAcctt).
The NGER Act requires the Group to report its annual greenhouse gas emissions and energy consumption for the period 1
July through 30 June each year. The Group has implemented systems and processes for the collection and calculation of the
data required and receives independent limited assurance on this data. The Group submits its report in October each year
inline with the filing requirements.
The Group is also subject to regulatory obligations as a signatory to, and complying with, the Australian Packaging Covenant,
and as a member of the Australian Packaging Covenant Organisation (APCO). APCO is a not-for-profit organisation, accredited
by the Commonwealth Government, whose role is to administer the Australian Packaging Covenant. As a signatory to the
Australian Packaging Covenant, the Group’s obligations include preparing and implementing an action plan and submitting
annual reports to APCO. The Group submitted its first annual report in March 2023 and Action Plan in May 2023, meeting
regulatory obligations.
The Group believes its operations are not materially affected by any other significant environmental regulation under any law
of the Commonwealth of Australia or any State or Territory of Australia.
The Group's Sustainability Strategy: Responsible Business, Sustainable Destinations and key activities to manage the
sustainability risks identified as part of its materiality assessment can be found in the Company's Sustainability Reports on
the Company's website in addition to existing policies and controls.
16
56
16
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
3
4
5
LOSS PER SHARE
Basic and diluted loss per share for the financial year was 211.7 cents (2022: 21.3 cents). Loss per share is disclosed in
note F3 of the Financial Report.
DIVIDENDS
No final dividend was declared in accordance with the conditions of debt covenant waivers which restrict further cash
dividends from being paid until the Group’s gearing, which represents the ratio of net debt to 12 month trailing statutory
EBITDA, is below 2.5 times, the Group returns to suitability and all of the Group's casino licences are in full force and effect.
SIGNIFICANT EVENTS AFTER THE END OF THE FINANCIAL YEAR
CCaassiinnoo dduuttyy rreeffoorrmmss
On 11 August 2023 the NSW Treasurer and the Group announced an in-principle agreement had been reached in relation to
changes to casino duty rates for casinos in New South Wales and their impact on The Star Sydney. The in-principle
agreement supersedes the proposal announced by the previous Liberal NSW Treasurer on 17 December 2022. Once
formalised the amendments announced are designed to deliver a sustainable outcome for The Star Sydney and to protect
the jobs of thousands of NSW team members.
The changes include rate increases for rebate duty (10% to 12.5%) and Table Games (17.91% to 20.25%) from 1 July 2023.
Poker Machine duty rates will remain unchanged until 2030 (currently 20.91%, 21.91% from 1 July 2024 and 22.91% from
1 July 2027). From 1 July 2030 poker machines will be taxed based on average poker machine revenue using a progressive
rate scale with a maximum of 51.6%. In the period 1 July 2023 to 30 June 2030 an additional levy will apply equal to 35% of
The Star Sydney’s gaming revenue above $1.125 billion per financial year. There is no change to the Responsible Gambling
Levy rate.
Further, the in-principle agreement includes a jobs agreement that provides employment certainty for team members in
arrangements agreed with the United Workers Union. The Star Sydney will also introduce a trial of its cashless gaming
machine technology in October 2023 on 50 gaming machines and 8 gaming tables.
DDBBCC ddiissppuuttee wwiitthh MMuullttiipplleexx
The Group has partnered with Hong Kong-based organisations Chow Tai Fook Enterprises Limited and Far East Consortium
International Limited to form Destination Brisbane Consortium (DDBBCC) for the Queen's Wharf Brisbane Project.
Multiplex (MMPPXX) is the principal contractor on the Queen’s Wharf Brisbane Integrated Resort Development project. Since early
2022 MPX has submitted a number of claims to DBC seeking damages and extensions of time and makes various
allegations against DBC and the principal’s representative. DBC claims that it is entitled to liquidated damages from MPX due
to its failure to meet contractual completion dates and commenced deducting liquidated damages from MPX in July 2023.
On 18 May 2023, MPX issued a Formal Dispute notice to DBC. MPX also included in its July 2023 progress claim, significant
claims for delay costs and acceleration costs and for repayment of liquidated damages deducted. These claims have been
reviewed and rejected by the Principal’s Representative during the course of the contract. DBC delivered a detailed Payment
Schedule on 8 August 2023 rejecting these claims in total and deducting further liquidated damages from the monthly
amount that would have been payable to Multiplex. On 18 August 2023 DBC was served with a Statement of Claim filed by
MPX in the Supreme Court of Queensland. The claim seeks various declarations from the Court regarding extensions of time,
relevant milestone dates, liquidated damages, variations and certain other matters, including potential sums payable, in
connection with the contract and seeks various orders in relation to those matters. The Group understands that DBC intends
to defend the proceedings.
On 28 August 2023, DBC was issued with an adjudication application lodged by MPX with the Queensland Building and
Construction Commission under the Building Industry Fairness (Security of Payment) Act 2017 (Qld). The application is
seeking awards by the adjudicator for extensions of time, certification of stage completion, entitlements to liquidated
damages and payment of certain amounts (comprising delay costs, set-offs, acceleration costs, variations and other
amounts). The adjudication claim is separate to the Supreme Court proceedings. The Group understands that DBC is
currently reviewing the adjudication application and that it intends to respond in accordance with the process in the relevant
legislation.
17
17
57
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
6
DIRECTORS' QUALIFICATIONS, EXPERIENCE AND SOCIAL RESPONSIBILITIES
The details of the Company's Directors in office during the financial year and until the date of this report (except as otherwise
stated) are set out below.
CCuurrrreenntt DDiirreeccttoorrss
DDaavviidd FFoosstteerr
Chairman (from 31 March 2023;)
IInnddeeppeennddeenntt NNoonn--EExxeeccuuttiivvee DDiirreeccttoorr (from 15 December 2022)
Master of Business Administration; Bachelor of Applied Science; Fellow of the Australian
Institute of Management; Senior Fellow of the Financial Services Institute of Australasia;
Member of the Australian Institute of Company Directors
Experience:
David Foster is an experienced chairman and non-executive director, who has served on boards
across a diverse range of industries including financial services, retail, government, education
and professional services.
David currently holds various ASX-listed company directorships, including as a Director of
Bendigo and Adelaide Bank Limited and as Chairman of G8 Education Limited.
David is the former Chairman of the Regional Investment Corporation and was previously a
Board member of Genworth Mortgage Insurance Australia and a Non-Executive Director of
Australian Reinsurance Pool Corporation.
David forged a career of more than 25 years in the financial services sector, including over five
years as Chief Executive Officer of Suncorp Bank where he had responsibility for navigating the
Bank through the global financial crisis and delivering a significant turnaround and restructuring
of the Bank. He retired as CEO at the end of 2013.
Special Responsibilities:
- Chairman of the Board
- Member of the Audit Committee
- Interim Chair of the Risk and Compliance Committee (pending probity approval of new director)
- Member of the Remuneration and People Committee
- Member of the Safer Gambling, Governance and Ethics Committee
Directorships of other Australian listed companies held during the last 3 years:
- Bendigo and Adelaide Limited (4 September 2019 to present)
- G8 Education Limited (1 February 2016 to present)
- Helia Group Limited (30 May 2016 to 31 March 2022)
- Motorcycle Holdings Limited (8 March 2016 to 23 December 2022)
18
58
18
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
CCuurrrreenntt DDiirreeccttoorrss
RRoobbbbiiee CCooookkee
Managing Director and Group Chief Executive Officer
(Robbie commenced as Group Chief Executive Officer on 17 October 2022 and was appointed
Managing Director on 18 November 2022).
Bachelor of Laws (Honours); Bachelor of Commerce; Graduate Diploma in Company
Secretarial Practice; Associate of the Governance Institute of Australia; Member of the
Australian Institute of Company Directors; Solicitor of the Supreme Court of Queensland
Experience:
Robbie Cooke has led four ASX listed companies in a business career spanning more than 30
years. He has traversed scale-ups, listings and significant M&A actions. He had an 11-year
executive career in lotteries, race wagering and sports betting at Tatts Group Limited and a
predecessor company, UNiTAB Limited, including five years as CEO and Managing Director.
Robbie also ran Australia’s leading online travel company Wotif.com Limited for seven years,
taking the business through scaleup from start-up mode, achieving a circa fivefold increase in
profits and a successful IPO in 2006. Immediately prior to joining The Star, Robbie was the Chief
Executive Officer and Managing Director of Tyro Payments, an Australian based payments fintech
which he successfully led to Initial Public Offering in 2019.
Special Responsibilities:
Nil
Directorships of other Australian listed companies held during the last 3 years:
- Tyro Payments Limited (18 October 2019 to 3 October 2022)
MMiicchhaaeell IIsssseennbbeerrgg
Independent Non-Executive Director (from 11 July 2022)
BS in Hotel Administration – Cornell University USA
French Order of Merit (Ordre national du Mérite)
Experience:
Michael Issenberg is an experienced executive and director with over 40 years’ experience in the
hotel and casino industries.
Michael is currently Chairman of Tourism Australia, Director of TFE Hotels, and he is a Lifetime
Member of Tourism & Transport Forum Australia and the Cornell Hotel Society.
Michael was formerly the Chairman of Reef Corporate Services Limited and Non-Executive
Director for over 20 years, the Responsible Entity of Reef Casino Trust. Prior to that, he held
various executive roles with AccorHotels for 25 years, most recently as Chairman and Chief
Executive Officer of AccorHotels Asia Pacific. He previously held the role of Chief Executive Officer
of Mirvac Hotels, following a successful career at Westin Hotels and Resorts, Laventhol &
Horwath, and Horwath & Horwath Services Pty Limited in San Francisco and Sydney.
Special Responsibilities:
- Member of the Audit Committee
- Member of the Safer Gambling, Governance and Ethics Committee
- Chair of the Remuneration and People Committee
Directorships of other Australian listed companies held during the last 3 years:
- Reef Corporate Services as responsible entity of Reef Casino Trust (21 January 2002 to
18 March 2022)
19
19
59
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
CCuurrrreenntt DDiirreeccttoorrss
DDeebboorraahh PPaaggee AAMM
Independent Non-Executive Director (from 13 March 2023)
Bachelor of Economics, Fellow of Chartered Accountants Australia and New Zealand,
Fellow of the Australian Institute of Company Directors
Experience:
Deborah Page is a Chartered Accountant with dual audit partner and CFO experience during her
executive career. She has specific experience in corporate finance, accounting, audit, mergers
and acquisitions, capital markets, insurance and joint venture arrangements.
Deborah has extensive experience as a company director gained across ASX listed, private,
public sector and regulated entities since 2001. Her relevant sector experience includes
property, technology, and the regulated sectors of insurance and funds management.
Deborah's experience
management, remuneration practices, investor relations and health, safety and environment.
leadership, governance and compliance,
includes Board
risk
Deborah is currently a Non-Executive Director of Brickworks Limited and Growthpoint Properties
Australia Limited.
Deborah is a member of Chief Executive Women and a member of the Takeovers Panel.
Special Responsibilities:
- Chair of the Audit Committee
- Member of the Risk and Compliance Committee
- Member of the Safer Gambling, Governance and Ethics Committee
Directorships of other Australian listed companies held during the last 3 years:
- Brickworks Limited (1 July 2014 to present)
- Growthpoint Properties Australia Limited (1 March 2021 to present)
- Pendal Group Limited (7 April 2014 to 23 January 2023)
- Service Stream Limited (21 September 2010 to 30 April 2023)
20
60
20
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
CCuurrrreenntt DDiirreeccttoorrss
AAnnnnee WWaarrdd
Independent Non-Executive Director (from 18 November 2022)
Barrister and Solicitor of the Supreme Court of Victoria; Fellow of the Australian Institute of
Company Directors; Bachelor of Laws; Bachelor of Arts
Experience:
Anne Ward is an experienced company director with expertise in business management,
strategy, governance, risk and finance and broad industry experience spanning financial
services, banking,
tourism,
entertainment and gaming.
technology, healthcare, government, education,
insurance,
Anne also has considerable experience in complex governance, transformation and risk
management across highly regulated sectors, including casinos.
Anne is currently Chair of ASX-listed ecommerce group Redbubble Ltd and communication
software provider Symbio Holdings Ltd.
Anne was formerly Chairman of Colonial First State Investments Ltd, Qantas Superannuation Ltd
and Zoos Victoria, and a director of Crown Resorts Limited, MYOB Group Ltd and Flexigroup Ltd.
She was previously a Council Member at RMIT University for several years, where she
contributed to an uplift in governance for the university sector in Australia.
Prior to her career as a professional director, Anne was a commercial lawyer for 28 years and
was General Counsel for Australia at the National Australia Bank and a partner at Minter Ellison
in Melbourne.
Special Responsibilities:
- Chair of the Safer Gambling, Governance and Ethics Committee
- Member of the Risk and Compliance Committee
- Member of the Remuneration and People Committee
Directorships of other Australian listed companies held during the last 3 years:
- Redbubble Ltd (22 March 2018 to present)
- Symbio Holdings Limited (22 July 2021 to present)
- Crown Resorts Limited (13 January 2022 to 24 June 2022)
21
21
61
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
FFoorrmmeerr DDiirreeccttoorrss
BBeenn HHeeaapp
GGeerraarrdd BBrraaddlleeyy AAOO
KKaattiiee LLaahheeyy AAMM
RRiicchhaarrdd SShheeppppaarrdd
Chairman (from 1 June 2022 to 31 March 2023)
NNoonn--EExxeeccuuttiivvee DDiirreeccttoorr (from 28 May 2018 to 31 March 2023)
Bachelor of Commerce (Finance); Bachelor of Science (Mathematics); Graduate of the
Australian Institute of Company Directors
Non-Executive Director (from 30 May 2013 to 31 October 2022)
Bachelor of Commerce; Diploma of Advanced Accounting; Fellow of the Institute of
Chartered Accountants; Fellow of CPA Australia; Fellow of the Australian Institute of
Company Directors; Fellow of the Institute of Managers and Leaders; Officer of the Order of
Australia
Non-Executive Director (from 1 March 2013 to 30 December 2022)
Bachelor of Arts (First Class Honours); Master of Business Administration; Member of the
Order of Australia
Non-Executive Director (from 1 March 2013 to 22 November 2022)
Bachelor of Economics (First Class Honours); Fellow of the Australian Institute of Company
Directors
22
62
22
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
7
DIRECTORS' INTERESTS IN SECURITIES
At the date of this report (except as otherwise stated), the Directors had the following relevant interests in the securities of
the Company:
OOrrddiinnaarryy SShhaarreess
PPeerrffoorrmmaannccee RRiigghhttss
CCuurrrreenntt
David Foster a
Robbie Cookeb
Michael Issenberg c
Deborah Page AM d
Anne Ward e
13,948
Nil
20,000
35,500
Nil
Nil
1,162,053
Nil
Nil
Nil
a
b
c
d
e
Appointed as Chairman on 31 March 2023. Appointed as Non-Executive Director on 15 December 2022 following the receipt of all
necessary regulatory approvals.
Appointed as Chief Executive Officer on 17 October 2022 with regulatory approvals in NSW pending. Commenced as Managing
Director on 18 November 2022 following the receipt of all necessary regulatory approvals.
Appointed as Non-Executive Director on 11 July 2022 following the receipt of all necessary regulatory approvals.
Appointed as Non-Executive Director on 13 March 2023 following the receipt of all necessary regulatory approvals.
Appointed as Non-Executive Director on 18 November 2022 following the receipt of all necessary regulatory approvals.
8
COMPANY SECRETARY
Jennie Yuen holds the position of Group Manager Shareholder Relations and Company Secretary (appointed on 29 July
2021).
Ms Yuen has a commercial and corporate law background in private practice and over 15 years of company secretariat and
corporate governance experience with ASX listed and public companies.
Prior to joining The Star Entertainment Group, Ms Yuen was employed as a solicitor and company secretary at Company
Matters Pty Limited and was the outsourced company secretary of various ASX listed companies, including Analytica Limited,
National Leisure and Gaming Limited and Oaks Hotels & Resorts Limited.
Ms Yuen holds a Bachelor of Laws and a Bachelor of Commerce. She is a member of the Queensland Law Society and a
Fellow of the Governance Institute of Australia.
23
23
63
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Appointed as Chairman on 31 March 2023. Appointed as Non-Executive Director on 15 December 2022 following the receipt of all
necessary regulatory approvals.
Appointed as Chief Executive Officer on 17 October 2022 with regulatory approvals in NSW pending. Commenced as Managing
Director on 18 November 2022 following the receipt of all necessary regulatory approvals.
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
9
BOARD AND COMMITTEE MEETING ATTENDANCE
During the financial year ended 30 June 2023, the Company held 45 meetings of the Board of Directors (including 33
unscheduled meetings). The numbers of Board and Committee meetings attended by each of the Directors during the year
are set out in the table below.
RReemmuunneerraattiioonn
&& PPeeooppllee
CCoommmmiitttteeee k
AA BB AA BB AA BB AA BB
RRiisskk &&
CCoommpplliiaannccee
CCoommmmiitttteeee j
AAuuddiitt
CCoommmmiitttteeee
BBooaarrdd ooff
DDiirreeccttoorrss
1
-
7
1
-
1
-
7
1
-
2
-
3
2
3
30
34
44
16
33
30
34
45
18
34
DDiirreeccttoorrss
David Foster a
Robbie Cooke b
Michael Issenberg c
Deborah Page AM d
Anne Ward e
FFoorrmmeerr
Ben Heap f
Gerard Bradley AO g
Katie Lahey AM h
Richard Sheppard i
A -
B - Maximum number of meetings available for attendance as a Board or Committee member.
a
Number of meetings attended as a Board or Committee member.
27
10
17
12
27
10
14
12
1
-
4
-
3
1
-
4
-
3
2
-
3
2
3
6
4
-
4
3
1
1
1
2
-
1
-
6
4
-
4
2
-
1
-
3
1
1
1
RReemmuunneerraattiioonn,,
PPeeooppllee && SSoocciiaall
RReessppoonnssiibbiilliittyy
CCoommmmiitttteeee l
AA
BB
SSaaffeerr GGaammbblliinngg,,
GGoovveerrnnaannccee &&
EEtthhiiccss
CCoommmmiitttteeee m
AA
BB
-
-
2
-
-
2
2
2
-
-
-
2
-
-
2
2
2
-
2
-
2
2
2
1
-
-
-
2
-
2
2
2
1
-
-
-
b
c
d
e
f
g
h
i
j
k
l
m
The Group Chief Executive Officer and Managing Director is not a member of any Board Committee but may attend Board Committee
meetings upon invitation. That attendance is not recorded here.
Appointed as Non-Executive Director on 11 July 2022 following the receipt of all necessary regulatory approvals.
Appointed as Non-Executive Director on 13 March 2023 following the receipt of all necessary regulatory approvals.
Appointed as Non-Executive Director on 18 November 2022 following the receipt of all necessary regulatory approvals.
Retired as Chairman and Non-Executive Director on 31 March 2023.
Retired as Non-Executive Director on 31 October 2022.
Retired as Non-Executive Director on 30 December 2022.
Retired as Non-Executive Director on 22 November 2022.
The Risk and Compliance Committee was formerly the Risk, Compliance and Regulatory Performance Committee (name changed on
21 November 2022.
The Remuneration and People Committee was formerly known as the Remuneration, People and Social Responsibility Committee.
The name and remit of the Remuneration, People and Social Responsibility Committee changed on 21 November 2022 following the
establishment of the Safer Gambling, Governance and Ethics Committee.
The Safer Gambling, Governance and Ethics Committee was established on 21 November 2022.
Details of the functions and memberships of the Committees of the Board and the terms of reference for each Board
Committee are available from the Corporate Governance section of the Company’s website.
10 INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
The Directors and Officers of the Company are indemnified against liabilities pursuant to agreements with the Company. The
Company has entered into insurance contracts with third party insurance providers, in accordance with normal commercial
practices. Under the terms of the insurance contracts, the nature of the liabilities insured against and the amount of
premiums paid are confidential.
24
64
24
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
11 INDEMNIFICATION OF AUDITORS
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young Australia, as part of the
terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount).
No payment has been made to indemnify Ernst & Young during or since the end of the financial year.
12 NON-AUDIT SERVICES
Ernst & Young, the external auditor to the Company and the Group, provided non-audit services to the Company during the
financial year ended 30 June 2023. The Directors are satisfied that the provision of non-audit services during this period was
compatible with the general standard of independence for auditors imposed by the Corporations Act 2001 (Cth). The nature
and scope of each type of non-audit service provided did not compromise auditor independence. These statements are made
in accordance with advice provided by the Audit Committee.
The Audit Committee reviews the activities of the independent external auditor and reviews the auditor’s performance on an
annual basis.
Limited authority is delegated to the Group Chief Financial Officer for the pre-approval of audit and non-audit services
proposed by the external auditor, limited to $50,000 per engagement and capped at 40% of the relevant year's audit fee.
Delegated authority is only exercised in relation to services that are not in conflict with the role of statutory auditors, where
management does not consider the services to impair the independence of the external auditor and the external auditor has
confirmed that the services would not impair their independence. Any other non-audit related work to be undertaken by the
external auditor must be approved by the Chair of the Audit Committee.
Further details relating to the Audit Committee and the engagement of auditors are available in the Corporate Governance
Statement.
Ernst & Young, acting as the Company’s external auditor, received or is due to receive the following amounts in relation to
the provision of non-audit services to the Company:
DDeessccrriippttiioonn ooff sseerrvviicceess
Fees for other assurance and agreed-upon-procedures services (including sustainability assurance)
under contractual arrangements where there is discretion as to whether the service is provided by the
auditor
Fees for other advisory and compliance services
TToottaall ooff aallll nnoonn--aauuddiitt aanndd ootthheerr sseerrvviicceess
$$000000
197.6
58.0
225555..66
Amounts paid or payable by the Company for audit and non-audit services are disclosed in note F10 of the Financial Report.
13 ROUNDING OF AMOUNTS
The Star Entertainment Group Limited is a company of the kind specified in the Australian Securities and Investments
Commission’s ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191. In accordance with that
Instrument, amounts in the Financial Report and the Directors’ Report have been rounded to the nearest hundred thousand
dollars unless specifically stated to be otherwise.
14 AUDITOR'S INDEPENDENCE DECLARATION
Attached is a copy of the auditor's independence declaration provided under section 307C of the Corporations Act 2001 (Cth)
in relation to the audit of the Financial Report for the year ended 30 June 2023. The auditor's independence declaration
forms part of this Directors’ Report. The financial year ended 30 June 2023 is Scott Jarrett's first year as Lead Audit Partner,
following rotation of the previous audit partner in accordance with section 92 of the Corporations Act 2001 (Cth).
This report has been signed in accordance with a resolution of Directors.
DDaavviidd FFoosstteerr
Chairman
Sydney
29 August 2023
25
25
65
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Ernst & Young
200 George Street
Sydney NSW 2000 Aust ralia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
Audit or’s Independence Declarat ion t o t he Dir ect ors of The St ar
Ent ert ainment Group Limit ed
As lead auditor for the audit of the financial report of The Star Enter tainment Group for the financial year
ended 30 June 2023, I declare to the best of my knowledge and belief, there have been:
a) No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit;
b) No contraventions of any applicable code of professional conduct in relation to the audit; and
c) No non-audit services provided that contravene any applicable code of professional conduct in
relation to the audit.
This declaration is in respect of The Star Enter tainment Group Limited and the entities it controlled during
the financial year.
Ernst & Young
Scott Jarrett
Part ner
29 August 2023
26
66
26
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT REMUNERATION REPORT
(AUDITED)
FOR THE YEAR ENDED 30 JUNE 2023
THE STAR ENTERTAINMENT GROUP LIMITED
ACN 149 629 023
ASX Code: SGR
and its controlled entities
67
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS’, REMUNERATION AND FINANCIAL REPORT
INTRODUCTION FROM THE REMUNERATION AND PEOPLE COMMITTEE CHAIR
Dear Shareholder,
On behalf of the Board, I present the Remuneration Report for the year ended 30 June 2023 (FY23). This report is prepared on a
consistent basis to the previous year for ease of reference.
FY23 has been a challenging year and we are actively working to regain the trust of our shareholders, guests, regulators and the
community and restore the value of your company. I want to thank Management and Team Members across the business who are
working tirelessly to deliver our remediation program, a roadmap to restoring and retaining our suitability to hold casino licences in
NSW and Queensland.
The FY22 Remuneration Report received positive support from shareholders with 70.25% voting for its adoption. We acknowledge
that 29.75% of shareholders voted against its adoption and have undertaken an extensive review of our remuneration policy and
frameworks to ensure that they support our purpose and goals going forward.
OUR FOCUS FOR THE FY24 REMUNERATION CYCLE
The remuneration framework plays an important role in reinforcing the right behaviours and culture across The Star. The short and
long-term incentive plans are currently the focus of a review in recognition of the strategic and operational challenges ahead and the
need to attract and retain high calibre talent. The focus of the review is to ensure that the remuneration tools in place support the
Board and management in the development of a strong risk management and regulatory compliance culture. The FY24 remuneration
framework will also introduce a consequence management framework to further reinforce individual accountability for poor outcomes
which do not support an environment of responsible gambling and the minimisation of harm to our guests. The changes will be outlined
in the FY24 Remuneration Report and are integral to our cultural transformation and return to suitability.
FY23 TERM INCENTIVE
As one of our actions to reduce the operating cost of our business this year, the Board determined that all short-term incentives for
FY23 would be cancelled.
Section 5.1 provides a detailed assessment of the outcomes delivered against the Group Key Performance Indicators (KPI) for FY23.
The Board exercised the discretion to reduce any incentive payable for FY23 to zero.
NON-EXECUTIVE DIRECTOR FEES
At the same time, the board also reduced the Non-Executive Director base and committee fees by 10% for the remainder of the financial
year (May and June).
LONG TERM INCENTIVE PLAN
The FY19 LTI award was tested against the Total Shareholder Return (TSR), Earnings Per Share (EPS) and Return On Invested Capital
(ROIC) performance hurdles. The hurdles were not met and the awards forfeited in full for the fourth consecutive year.
The FY20 LTI award will be tested against the relevant performance hurdles in October 2023.
KMP CHANGES
FY23 has been a period of accelerated renewal for both the executive team and the Board.
Robbie Cooke commenced as the Group Chief Executive Officer | Managing Director as did Scott Saunders as the Chief Risk Officer.
Geoff Hogg who had been Acting Chief Executive Officer, and Scott Wharton, The Star CEO and Group Head of Transformation also
resigned during the financial year.
The renewal of your Board has also progressed with David Foster (Chairman), Deborah Page and Anne Ward receiving the necessary
approvals and formal appointment to the Board while Toni Thornton contributed as an observer while waiting for the necessary
approvals prior to formal appointment.
Further detail around the timing of the individual KMP changes including departures appears at page 29.
On behalf of the Board, I invite you to read the Remuneration Report and we welcome your feedback.
Yours sincerely,
Michael Issenberg
Remuneration and People Committee Chair
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27
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2023
CONTENTS
01.
KEY MANAGEMENT PERSONNEL
02.
REMUNERATION GOVERNANCE
29
30
03.
REMUNERATION STRATEGY AND PROGRAMS
3.1 REMUNERATION OVERVIEW
3.2 FIXED REMUNERATION
3.3 STI DESIGN
3.4 LTI DESIGN
3.5 MINIMUM SHAREHOLDING POLICY
EXECUTIVE REMUNERATION
RECEIVED FY23
31
32
33
35
37
37
VARIABLE REWARD OUTCOMES FOR
THE FINANCIAL YEAR ENDED 30 JUNE 2023
04.
05.
5.1 STI OUTCOME FOR FY23
5.2 VESTING UNDER THE LTI
06.
EXECUTIVE KMP CONTRACTS
AND REMUNERATION
07.
STATUTORY EXECUTIVE KMP
REMUNERATION
08.
NED REMUNERATION
09.
OTHER INFORMATION
9.1 LOANS AND OTHER
TRANSACTIONS WITH KMP
38
40
42
43
43
45
The Directors of The Star Entertainment Group
Limited (The Star Entertainment Group or the
Company) have approved this Remuneration
Report for the consolidated entity comprising the
Company and its controlled entities (collectively
referred to as the Group) in respect of the
financial year ended 30 June 2023.
This Remuneration Report outlines the remuneration
arrangements for Key Management Personnel (KMP who are
defined as those persons having authority and responsibility
for planning, directing and controlling the major activities
of the Group, directly or indirectly, including any director
whether executive or otherwise) of The Star Entertainment
Group Limited. This report has been prepared in accordance
with the requirements of the Corporations Act 2001, (Cth)
(the Corporations Act) and its regulations. The information
has been audited as required by section 308(3C) of the
Corporations Act where indicated.
For the purposes of this report, the term ‘Executive KMP’
means the executive director (Group Chief Executive
Officer | Managing Director) and senior executives the
Chief Financial Officer, Chief Risk Officer and former CEO
The Star Sydney and Group Head of Transformation, and
former Acting Chief Executive Officer but excludes Non-
Executive Directors (NEDs).
THE STAR ENTERTAINMENT GROUP LIMITED
A.C.N. 149 629 023
ASX CODE: SGR
AND ITS CONTROLLED ENTITIES
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
01. KEY MANAGEMENT PERSONNEL
The names and titles of the Company’s KMP for the year ended 30 June 2023 are set out below.
NON-EXECUTIVE DIRECTORS
FORMER NON-EXECUTIVE DIRECTORS
David Foster1
Chairman
Anne Ward2
Chair of Safer Gambling, Governance
and Ethics Committee
Deborah Page AM3
Chair of Audit Committee
Michael Issenberg
Chair of Remuneration and People Committee
Gerard Bradley AO
(ceased 31 October 2022)
Board Member
Katie Lahey4 AM
(ceased 30 December 2022)
Chair of Remuneration, People and
Social Responsibility Committee
Richard Sheppard
(ceased 22 November 2022)
Chair of Audit Committee
Ben Heap5
(ceased 31 March 2023)
Chairman
CURRENT EXECUTIVE KMP
Robbie Cooke6
Managing Director and Chief Executive Officer
Christina Katsibouba7
Chief Financial Officer
Scott Saunders8
Chief Risk Officer
FORMER EXECUTIVE KMP
Geoff Hogg9
Acting Chief Executive Officer
Scott Wharton10
CEO The Star Sydney and Group Head of Transformation
1 On 22 March 2023, the Company announced the appointment of David Foster as Chairman, following the retirement of Chairman
Ben Heap. Mr Foster commenced in this role from 1 April 2023.
2 On 15 August 2022, the Company announced the appointment of Anne Ward as a Non Executive Director, subject to casino regulatory
approval being obtained. Anne Ward commenced as a Non-Executive Director on 18 November 2022.
3 On 11 November 2022, the Company announced the appointment of Deborah Page as a Non Executive Director, subject to casino
regulatory approvals being obtained. Deborah Page commenced as a Non-Executive Director on 13 March 2023.
4 On 15 December 2022, the Company announced that Katie Lahey would stand down from the Board. Ms Laheyʼs cessation date was
30 December 2022.
5 On 22 March 2023, the Company announced the resignation of Ben Heap from the Board. Mr Heapʼs cessation date was 31 March 2023.
6 13 October 2022, the Company announced the appointment of Robbie Cooke as Managing Director and Chief Executive Officer
commencing 17 October 2022.
7 On 28 December 2022, the Company announced the appointment of Christina Katsibouba as Chief Financial Officer effective
1 January 2023. Christina had been Interim Chief Financial Officer from 9 May 2022.
8 On 13 February 2023, the Company announced the commencement of Scott Saunders as Chief Risk Officer.
9 Geoff Hoggʼs cessation date with the Company was 24 March 2023.
10 Scott Wharton commenced with the Company on 25 July 2022, Scott Whartonʼs cessation date was 28 April 2023.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT 02. REMUNERATION GOVERNANCE
The Remuneration and People Committee (the Committee) considers matters relating to the remuneration of KMP as well as
the remuneration policies of the Group generally. This includes reviewing and recommending to the Board, the remuneration
of the Chairman and NEDs, Executive KMP and other direct reports to the MD and CEO. The main responsibilities of the
Committee are outlined in the Committee�s Terms of Reference, available on the corporate governance page of the Company’s
website at: www.starentertainmentgroup.com.au/corporate-governance/
Under the Committee’s Terms of Reference, the majority of Committee members must be independent non-executive
directors and the Chair of the Committee must be an independent non-executive director. All members of the Committee
(including the Chair of the Committee) are independent non-executive directors. Details of members of the Committee and
their background are included in the Directors’ Report.
THE FOLLOWING DIAGRAM REPRESENTS THE STAR ENTERTAINMENT GROUP’S
REMUNERATION DECISION-MAKING STRUCTURE
BOARD
– Reviews and approves remuneration outcomes,
framework, strategy and policy
– Exercises discretion in relation to targets,
goals or funding pools
REMUNERATION AND PEOPLE COMMITTEE
– Reviews and recommends to the Board the remuneration
framework, strategy and policy
– Reviews and recommends to the Board remuneration
review outcomes for NEDs, Executive KMP and other direct
reports to the MD and CEO
SHAREHOLDERS
– Feedback received through
shareholder votes on the
Remuneration Report at the
AGM and consultation with
key stakeholders
MANAGEMENT
– Proposals on executive
remuneration outcomes
– Implementing
remuneration policies
REMUNERATION ADVISORS
– External and
independent remuneration
advice and information
USE OF REMUNERATION ADVISORS
The Committee seeks external advice from time to time to ensure it is fully informed when making remuneration
decisions. Remuneration advisors are engaged by, and report directly to, the Committee. PricewaterhouseCoopers (PwC)
are the Group’s appointed independent external remuneration consultants. No remuneration recommendations as defined by
the Corporations Act were provided by PwC during FY23.
GENDER PAY EQUITY
The Group is committed to all employees being remunerated fairly and equitably. The Group conducts annual gender pay
equity reviews that are presented to the Committee and continues to address any gender pay equity issues as they arise.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT 03. REMUNERATION STRATEGY AND PROGRAMS
3.1 REMUNERATION OVERVIEW
REMUNERATION PRINCIPLES
FIGURE 1: REMUNERATION PRINCIPLES
Being market competitive
to attract and retain
high performing individuals.
Linking variable
pay outcomes
to both Company
and individual
performance.
Having a transparent
and leader-lead
performance
management system.
Promoting
gender pay
equity.
Administering consistent,
easy to understand,
transparent remuneration
practices underpinned by a
strong governance process.
REMUNERATION MIX
Variable remuneration (comprising STI and LTI at target amounts) accounts for the majority of the total remuneration mix for the
Managing Director and Chief Executive Officer and other Executive KMP as illustrated in Figure 2 below.
FIGURE 2: REMUNERATION MIX
Fixed
Remuneration
38.5%
38.5%
LTI
Fixed
Remuneration
46%
STI Cash
15.3%
7.7%
STI
Restricted
Shares
Fixed
At Risk
27%
LTI
9%
STI
Restricted
Shares
18%
STI Cash
Managing Director and Chief Executive Officer
Other Executive KMP
REMUNERATION TIME HORIZON
Figure 3 provides an illustrative indication of how remuneration will be delivered to Executive KMP.
FIGURE 3: REMUNERATION TIME HORIZON
Fixed Remuneration
STI Cash (66.66%)
STI restricted shares
(33.33%)
LTI performance
rights
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
Date granted
End of deferral/performance period
Date payable/eligible for vesting
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
Table 1 below summarises the components of Executive KMP’s Total Annual Reward (TAR) and their link to the strategic
objectives of the Group.
TABLE 1: COMPONENTS OF EXECUTIVE KMP’S TAR OPPORTUNITY
Rationale
Structure
Quantum
Fixed Remuneration
STI
LTI
Fixed remuneration forms
an integral component of
the overall employee value
proposition of the Group,
designed to attract and
retain the talented teams
required to operate the
business. These teams will
be critical in delivering on
our business plan to achieve
excellence in guest service,
build and operate world
class properties, and create
long term shareholder value.
Annual pay reviews occur
in August each year with
remuneration changes
effective from 1 September.
Base remuneration
and superannuation.
Targeted at the
median of relevant
external peer group.
The STI is designed to
drive the execution of the
business plan in the short
and long term and aligns
performance outcomes to
shareholder value creation.
STI performance targets
are underpinned by the
Group’s strategic priorities
that include:
The LTI is designed to
reward participants
for their contribution
towards achieving the
Group’s strategic priorities
orientated around delivering
long term sustainable
shareholder value creation.
Performance is measured
against three criteria:
– Shareholder Value
– Relative Total Shareholder
– World Class Properties
Return (TSR)
– Guest Service Excellence
– Earnings per Share (EPS)
(differentiated value
proposition)
– Return on Invested
Capital (ROIC)
– Talented Teams
– Risk Management and
Sustainability
Two thirds cash, one
third restricted shares
deferred for one year.
Performance rights
with vesting subject
to performance over
a four year period.
Executive KMP target 60%
of fixed remuneration.
MD & CEO target 60% of
fixed remuneration.
Executive KMP target 60%
of fixed remuneration.
MD & CEO target 100% of
fixed remuneration.
3.2 FIXED REMUNERATION
The fixed remuneration received by Executive KMP may include base salary, superannuation and non-monetary benefits.
The amount of fixed remuneration an executive receives is based on the following:
– Scope and responsibilities of the role;
– Reference to the level of remuneration paid to executives of comparable ASX-listed organisations, with similar market
capitalisation (range 70% to 160% of The Star Entertainment Group’s market capitalisation) and appropriate gaming
and entertainment peers; and
– Level of international and domestic gaming knowledge, skills and experience of the individual.
Fixed remuneration is reviewed annually, and the policy is to target fixed remuneration at the median of the market. Fixed
remuneration may deviate from the market median depending on the individual’s capabilities and other business factors.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT 3.3 STI DESIGN (STI)
The STI design incorporates the following elements:
– A holistic ‘basket of measures’ to assess Company performance
A holistic basket of measures to assess Company performance achieves a greater balance between financial and
non-financial measures. Company performance accounts for 80% of the overall STI award for Executive KMP, with
the capacity to pay maintained through a higher weighting on the NPAT metric at 40% of the total award.
– Company metrics – Group Regulatory Compliance and Risk Management, Employee Engagement and Guest
Satisfaction
The Group Regulatory Compliance and Risk Management metric was increased to a weighting of 20% of the award
opportunity to recognise the Company’s focus on this critical area in the business. This metric takes into account safety
measures, mandatory compliance training, remediation milestones and timely reporting of incidents and breaches.
Engagement as a metric to enhance the focus on people as the Company faces increasing competition for talent
which also has a weighting of 10% of the total award opportunity. A Guest Satisfaction performance metric of 10% to
focus on providing Guests with exceptional service.
– Individual performance
Individual performance accounts for 20% of the overall STI award for Executive KMP. This allows for emphasis to be
placed on individual priorities for each Executive KMP to reward exceptional performance.
– Guiding principles to inform the use of discretion
Similar to the LTI, a set of guiding principles inform the use of discretion under the STI (refer to Table 2 below).
The number of employees who participated in the STI for FY23 was 776 (increased from 682 for FY22). Each of the Executive
KMP participated in the plan.
Table 2 sets out the key features of the STI.
TABLE 2: KEY DESIGN FEATURES OF THE STI
Purpose
To reward participants for execution of the Group’s strategy and achievement of operational goals
during the performance period.
Performance
Metrics and
weightings
Metric
Group Normalised NPAT1
Group Guest Satisfaction
Group Regulatory Compliance and Risk Management
Group Engagement
Individual Performance
Weighting
40%
10%
20%
10%
20%
Group
Performance
Metrics
Payment Scale
Individual
Performance
Payment Scale
Group performance metrics are assessed by measuring each individual outcome against the Board
approved targets.
Outcome %
<90%
90%
95%
100%
110%
Payout %
No payment
50%
75%
100%
150%
Individual performance is determined by assessing performance against individual priorities to arrive
at a performance rating. Performance ratings link to payment ranges as follows:
Rating
1 – Did not meet
2 – Meets some
3 – Meets all
4 – Exceeds
5 – Outstanding
Payout % Range
No payment
0 – 50%
50 – 100%
100 – 125%
125 – 150%
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
Payment
calculation
A participant’s individual STI award is based on the following calculation:
Fixed
Remuneration
X
Individual
Target STI %
X
Performance
Metrics
Outcome %
(0 – 150%)
=
Individual
STI award
(capped at
150% x
target)
Incentive
opportunity
levels
Delivery of
payments
(including
deferrals)
Clawback
Guiding
Principles
for informing
discretion
Opportunities are based on the participant’s incentive target in their employment contract (refer Table 12).
The payment range available is 0% – 150% of the participant’s incentive target.
Two-thirds of payments are delivered in cash in September.
One-third of all payments are held in restricted shares for a period of twelve months from the date of
the award. These shares are forfeited in the event that the participant voluntarily terminates from the
Group or is terminated with cause (refer Clawback below). Restricted shares may also be forfeited
in part or full in instances of fraud, dishonesty, breach of obligations including the Group’s Code of
Conduct. Participants are entitled to receive dividends and have voting rights during the restriction
period, however they are unable to vote on remuneration resolutions at the AGM.
Incentives may be clawed back where there has been a material misrepresentation of the financial
outcomes on which the payment had been assessed and/or the participant’s actions have been found
to be fraudulent, dishonest or in breach of the Group’s Code of Conduct (e.g. misconduct). This
provision may extend up to the prior three financial years of STI payments.
1. Nature and timing of adjustments – adjustments, both positive and negative, will only be made to
the performance/reward outcome (rather than the target) at the time of vesting.
2. Transparency – the Company will provide a clear rationale and disclosure for any adjustments
made (for example, providing a reconciliation to statutory results), especially in cases where, prima
facie, performance has not been achieved.
3. Material or significant events – adjustments will only be made for events or items over the
performance period that have a material impact on the outcome. Adjustments will also only be
made where it has an impact on the result of the award.
4. Balancing short term and long term performance – adjustments will be made that balance the
interests of short term performance outcomes with long term performance outcomes. For example,
where a short term objective was not met because a strategic decision was taken to support a
longer term objective. Adjustments will, where appropriate, be informed by the assumptions used
in the business plan from which the target was set, to determine whether there has been a material
deviation in the assumptions used and whether this was outside of management’s control.
5. Maintain plan integrity – adjustments will be carefully considered to ensure they maintain the
plan’s integrity and purpose.
6. Assessing behavioural impacts on performance outcomes – the actions of participants will be
considered in the achievement of performance metrics to assess adherence to the Company’s code
of conduct.
7. Exercising discretion consistently and fairly – the use of discretion will be applied consistently
both positively and negatively and information used will be sufficiently objective and free from bias
to ensure decisions are arrived at fairly.
1 Normalised results reflect the underlying performance of the business and exclude significant items that are considered by their nature
and size unusual or not in the ordinary course of business. This methodology has been consistently applied since FY12.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT 3.4 LTI DESIGN
There were no changes to the design or performance measures in place for FY23.
In FY23, there were 20 participants invited to participate in the plan (32 participants in FY22). Each of the Executive KMP
participates in the plan.
TABLE 3: KEY DESIGN FEATURES OF THE LTI
Purpose
The LTI is designed to reward participants for their contributions towards achieving the Group’s
strategic priorities orientated around delivering long term sustainable shareholder value creation.
Type of
Equity Award
Performance rights (zero exercise price options) are used for the LTI. No amount is payable on the
grant of the performance rights or upon vesting of performance rights. If the performance rights vest,
an equivalent number of fully paid ordinary shares will be automatically delivered to the holder.
Determination
of the number
of rights
Dividend
entitlements
Test Date and
Vesting date
Cessation of
employment,
Change of
Control and
Clawback
Vesting
conditions
(hurdles)
Upon vesting of the performance rights and subject to the holder remaining employed with the
Company, the Company will deliver to the holder fully paid ordinary shares in the Company. The holder
will receive full voting and dividend rights corresponding to the rights of all other holders of ordinary
shares in the Company.
The number of performance rights allocated to a participant is based on their Target LTI award,
divided by the Face Value of a Performance Right as shown in the following calculation:
Target LTI ($)
÷
Face Value of
a performance
right
=
Number of
performance
rights
allocated
The Face Value reflects the face value of the share at the effective Grant Date with reference to the
volume weighted average price (VWAP) of the Company’s shares traded on the ASX on the 20 trading days
prior to the Effective Grant Date. Details of annual grants to Executive KMP are set out in Table 10.
Participants are not entitled to dividends until shares are allocated (based on meeting the relevant
performance hurdles). At that time, dividends will either be paid by allocating dividend equalisation
shares or by means of a cash equivalent payment, based on actual dividends paid to shareholders
during the vesting period, the degree to which performance hurdles were met and the extent of vesting
of the award.
Performance rights are tested on the fourth anniversary of the Effective Grant Date and are not
subject to retesting.
All unvested performance rights lapse immediately upon cessation of employment with the Group.
However, the Board has discretion in special circumstances to determine the number of performance
rights retained and the terms applicable. Special circumstances include events such as retirement,
redundancy, death and permanent disability. If a Change of Control Event occurs, or the Board determines
in its absolute discretion that a Change of Control Event may occur, the Board will determine in its absolute
discretion appropriate treatment regarding any awards.
Unvested rights may be forfeited where there has been a material misrepresentation of the financial
outcomes on which the award had been assessed and/or the participant’s actions have been found to
be fraudulent, dishonest or in breach of the Company’s Code of Conduct (e.g. misconduct).
TSR (33.3% of the award)
The Company’s TSR ranking against the peer group of companies (relative TSR) is used as a
performance hurdle, as it directly aligns the interests of participants with the interests of shareholders,
which is to maximise its TSR compared with the TSR for peer companies.
The table below sets out the vesting scale for TSR. The Company’s TSR ranking, compared to its peer
group, must be at least at the 50th percentile for any vesting to occur.
TSR Percentile Ranking
Below the 50th percentile
At the 50th percentile
Percentage of awards vesting
0% vesting
50% vesting
Above the 50th and below the 75th percentile
Pro-rata between 50% (at 50th percentile)
and 100% (at 75th percentile)
At or above the 75th percentile
100%
EPS (33.3% of the award)
The EPS hurdle measures statutory earnings per ordinary share adjusted for the theoretical win rate in
the VIP Rebate business. It drives a line of sight between shareholder value creation and management’s
financial performance.
The threshold hurdle is set by the Board by reference to market consensus. The target hurdle is set by
the Board by reference to the Company’s Board approved five-year business plan. While the Board
may exercise certain discretions under the LTI, the Board will only consider exercising its discretion with
respect to any applicable adjustments to thresholds and targets, at the time of testing for vesting
purposes (refer to guiding principles on next page).
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Vesting conditions
(hurdles)
(continued)
The table below sets out the percentage of the performance rights subject to the Company’s EPS
performance as at the Test Date.
EPS Performance
Below threshold
At threshold
Percentage of awards vesting
0% vesting
50% vesting
Between threshold and stretch
Pro-rata between threshold and stretch
Stretch target
100%
ROIC (33.4% OF THE AWARD)
The ROIC hurdle measures statutory EBIT, adjusted for the theoretical win rate in the International VIP
Rebate business, as a proportion of average Net Debt and average Shareholder Equity. That is:
ROIC = EBIT adjusted for theoretical win rate in the International VIP Rebate business
Average Net Debt + average Shareholder Equity
The ROIC hurdle measures the efficiency of earnings generated from capital investments made by
the Group and seeks to create alignment of incentive programs in driving the execution of the
Group’s capital intensive strategy to build new assets and improve existing properties, with the aim
of generating additional revenue and ultimately sustainable value for shareholders.
The threshold hurdle is set by the Board based on the Group’s present ROIC levels, and the target
hurdle is set with reference to the Group’s five-year business plan.
While the Board may exercise certain discretions under the LTI, the Board will only consider exercising its
discretion with respect to adjustments to thresholds and targets at the time of testing for vesting purposes
and applying the guiding principles set out below.
The table below sets out the percentage of performance rights subject to the Company’s ROIC
performance as at the Test Date.
ROIC Performance
Below threshold
At threshold
Percentage of awards vesting
0% vesting
50% vesting
Between threshold and stretch
Pro-rata between threshold and stretch
Stretch target
100%
The Company will disclose the EPS and ROIC targets on a retrospective basis to ensure that the
Company’s competitive position is not undermined.
The Board has adopted a set of guiding principles when it considers adjustments to performance
outcomes under the LTI. The process for adjustments and principles applied are outlined below:
1. Nature and timing of adjustments – adjustments, both positive and negative, will only be made to the
performance/reward outcome (rather than the target) at the time of vesting.
2. Transparency – the Company will provide a clear rationale and disclosure, for any adjustments made
(for example, providing a reconciliation to statutory results), especially in cases where, prima facie,
performance has not been achieved. Where possible, advance disclosure of events that may give rise
to adjustments will be disclosed to ensure early communication to shareholders.
3. Material or significant events – adjustments will only be made for events or items over the vesting
period that have a material impact on the outcome. Adjustments will also only be made where it has an
impact on the result of the award. Where possible, the item will be referenced back to the assumptions
used in the business plan from which the target was set, to determine whether there has been a
material deviation in the assumptions used and whether this was outside of management’s control. For
example, if there has been a change to accounting policies resulting in the EPS and/or ROIC targets
being determined in a different way to how the outcome is determined at the time of vesting.
4. Balance interests of shareholders and management – adjustments will be made to balance
the interests of shareholders and management, for example, if shareholders are experiencing poor
results, then management should share in the burden, and vice versa (unless there are compelling
reasons for this not being the case, in which event, details will be provided).
5. Maintain plan integrity – adjustments will be carefully considered to ensure they maintain
the plan’s integrity and purpose (i.e. to incentivise and reward management for undertaking
transactions that deliver long-term sustainable shareholder value).
6. Exercising discretion consistently and fairly – the use of discretion will be applied consistently
(both positively and negatively) and information used will be sufficiently objective and free from bias
to ensure decisions are arrived at fairly.
Disclosure of
performance
hurdles
Guiding principles
for informing
discretion
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT 3.5 MINIMUM SHAREHOLDING POLICY
To support the alignment of the interests of the Board and executives with the interests of shareholders, the Group has
minimum shareholding policies in place. Executive KMP are required to progressively acquire shares over a five year
period from the date of their commencement in the role (for new Executive KMP).
The minimum shareholding policies for NEDs, Executive KMP and Other Executives are reviewed every three years to
ensure that they remain suitable for the business, to align the interests of these individuals and with shareholders generally.
The Managing Director and Chief Executive Officer is to hold a minimum number of shares which is of equal value to 150%
of one year’s salary (excluding superannuation) at the time of his commencement. Other Executive KMP are to hold a
minimum number of shares which is of equal value to 100% of one year’s salary (excluding superannuation) at the time of
their commencement. Direct and indirect holdings in shares will count towards the minimum shareholding target. Unvested
performance rights do not count towards minimum shareholding requirements.
All Executive KMP are on track to meet the minimum shareholding requirements in the required timeframes.
Table 4 shows the number of shares and performance rights held by Executive KMP at the beginning and end of the financial
year unless otherwise stated.
TABLE 4: SHARES AND PERFORMANCE RIGHTS HELD BY EXECUTIVE KMP AT 30 JUNE 2023
Name
Holding
Balance at
start
of the year1
Granted as
compensation
Restricted
shares
released during
the year2
Lapsed
during
the year
Balance
at the end
of the year3
Current Executive KMP
Robbie Cooke
Performance Rights
Ordinary Shares
Restricted Shares
–
–
–
1,162,053
–
–
Christina
Katsibouba
Performance Rights
195,095
174,501
Ordinary Shares
277
–
Restricted Shares
Scott Saunders Performance Rights
Ordinary Shares
Restricted Shares
Former Executive KMP
Scott Wharton Performance Rights
Ordinary Shares
Restricted Shares
–
–
–
–
–
–
–
Geoff Hogg
Performance Rights
403,928
Ordinary Shares
307,106
14,621
169,047
–
–
345,366
–
–
–
–
Restricted Shares4
1,976
26,726
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,162,053
–
–
(20,145)
349,451
–
–
–
–
–
(345,366)
–
–
(403,928)
277
14,621
169,047
–
–
–
–
–
–
3,623
(3,623)
–
310,729
(25,079)
–
1 For KMP who commenced in the role during the year, the balance disclosed is from the date they commenced as a KMP.
2 Restricted shares that are no longer subject to a holding lock are transferred into the ordinary shares category.
3 For KMP who ceased their role during the year, the balance disclosed is until the date they ceased as a KMP.
4 Includes 1,647 ordinary shares acquired in FY23 through salary sacrifice under the General Employee Share Plan. The shares are subject
to a holding lock of two years from the acquisition dates. The holding lock was removed on cessation.
04. EXECUTIVE REMUNERATION
RECEIVED FY23
REMUNERATION OUTCOMES FOR EXECUTIVE KMP IN FY23
Table 5 provides a summary of total remuneration received by Executive KMP during the 2023 financial year. This non-
IFRS information differs from the Statutory Remuneration in Table 13, which presents remuneration in accordance with
accounting standards.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT TABLE 5: FY23 EXECUTIVE REMUNERATION
Name
Fixed
remuneration
STI
Cash
Total
Cash
STI deferred
equity
LTI vested actual
during the year $
Total value of
remuneration2 $
LTI lapsed
during the year1
Current Executive KMP
Robbie Cooke
1,136,508
Christina Katsibouba
800,000
Scott Saunders3
672,083
Former Executive KMP2
Geoff Hogg
1,050,804
Scott Wharton
724,152
TOTAL
4,383,547
–
–
–
–
–
–
1,136,508
800,000
672,083
1,050,804
724,152
4,383,547
–
–
–
–
–
–
–
–
–
–
–
–
1,136,508
–
800,000
(23,267)
672,083
–
1,050,804
(466,537)
724,152
(398,898)
4,383,547
(888,702)
1 Represents the award value (at the 30 June 2023 share price) of the FY19 performance rights that lapsed/were foregone during the year
as the minimum performance hurdles required for vesting were not met.
2 Includes payments made after resignations were tendered, including any notice period and termination payments.
3 Scott Saunders received a payment of $375,000 on completion of 3 months service and receipt of all regulatory approvals in recognition
of incentives foregone from his previous employer.
05. VARIABLE REWARD OUTCOMES FOR
THE FINANCIAL YEAR ENDED 30 JUNE 2023
5.1 STI OUTCOME FOR FY23
GROUP PERFORMANCE:
Under the Companyʼs new STI design, as detailed in Table 2, awards for Executive KMP are generated by performance
against four Company metrics, comprising 80% of the award, and individual performance comprising 20% of the award.
Details of the Companyʼs targets and outcomes for FY23 are noted in Table 6 below.
TABLE 6: FY23 PERFORMANCE OUTCOMES AGAINST KEY PERFORMANCE INDICATORS FOR THE STI
STI Metric
Weighting
Target
Outcome
Outcome
% of Target
Weighted
Outcome %
NPAT
– Deliver Budgeted Normalised NPAT
Guest Satisfaction
– Elevate the guest service culture and guest
experience across all our properties
Regulatory
Compliance
& Risk
Management
– Total Reportable Injury
Frequency Rate (TRIFR)
– Compliance Training
Completion
– Remediation program
of work1
Engagement
– Retain talented teams through a compelling
Employee Value Proposition and highly engaged
Team Member environment.
Weighted Group STI Outcome
Final Group STI outcome
(Board discretion applied)
40%
$99.4m
$41.7m
-58%
0%
10%
104
104
100%
10%
6.67%
13.3
16.9
77%
6.67%
90
96.5
107%
0%
9%
6.66%
MET
MET
100%
6.66%
10%
7.5
7.3
85%
8.5%
34%
0%
In consideration of the challenging operating environment, management recommended the Board determine that the STI
plan for FY23 would be cancelled as one initiative to reduce the operating cost base of the Group.
1 Internal Control Manual uplift for NSW delivered to the agreed target and date. Internal Control Manual uplift program for QLD is on track.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT EXECUTIVE KMP PERFORMANCE
The individual priorities of the KMP which account for 20% of the potential award shifted materially in response to the
changing commercial and regulatory environment which emerged during FY23. The individual component of the FY23
STI was also cancelled by the Board at management's recommendation.
Table 7 details the variable remuneration of Executive KMP under the STI during the period.
TABLE 7: VARIABLE REMUNERATION UNDER THE STI FOR THE YEAR ENDED 30 JUNE 2023
Executive
Financial
year
Cash
Award
$
Restricted
Share Grant
$
As a % of total
remuneration
STI not
achieved as a
% of target1
Current Executive KMP
Robbie Cooke
Christina Katsibouba
Scott Saunders
Former Executive KMP
Geoff Hogg
Scott Wharton
TOTAL FY23
TOTAL FY22
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
–
–
–
–
–
–
–
–
–
–
–
–
–
–
137,835
68,918
–
–
–
–
–
–
137,835
68,918
1 Maximum opportunity is 150% of the executivesʼ target incentive level.
0%
–
0%
–
0%
–
0%
20%
0%
–
100%
–
100%
–
100%
–
100%
55%
100%
–
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
Table 8 outlines the performance of the Group and shareholder returns over the last five financial years.
TABLE 8: STATUTORY KEY PERFORMANCE INDICATORS
Performance metric
Statutory NPAT
Basic EPS (statutory)
Full year dividend (fully franked, cents per share)
20.5c
Share price at year end
Increase/(decrease) in share price
$4.12
(16%)
10.5c
$2.84
(31%)
FY19
FY20
FY21
FY22
FY23
$198.0m
$(94.6)m
$57.9m
$(202.5)m $(2435.2)m
21.6c
(10.3)c
6.1c
0.0c
$3.69
+30%
(21.3)c
(211.7)c
0.0c
$2.79
(24%)
0.0c
$1.16
(59%)
5.2 VESTING UNDER THE LTI
Since the Company’s inception in 2011, there have been twelve awards made under the LTI, with seven awards tested and
two vesting outcomes (FY14 and FY15 awards). Table 9 sets out the details of performance rights issued over the last five
financial years.
TABLE 9: DETAILS OF LTI AWARDS ACTIVE DURING THE YEAR
Detail
Effective
Grant Date
Test date
FY19 Award
FY20 Award
FY21 Award
FY22 Award
FY23 Award
3 Oct 2018
25 Sep 2019
24 Sep 2020
23 Sep 2021
26 Sep 2022
3 Oct 2018
25 Sep 2023
24 Sep 2024
23 Sep 2025
26 Sep 2026
Vesting hurdle(s)
TSR, EPS & ROIC TSR, EPS & ROIC TSR, EPS & ROIC TSR, EPS & ROIC TSR, EPS & ROIC
Test result
All rights lapsed
N/A
N/A
N/A
N/A
During FY23, the FY19 Award was tested and did not vest as performance hurdles were not met. The next test date will be in
September 2023, for performance rights granted in FY20.
Performance rights relating to the FY19 award were tested in October 2022 and 100% lapsed. The TSR performance of
the Group was -42.33% (excluding the value of franking credits), with a percentile ranking of 15.39%. As this was below
the 50th percentile, none of the TSR component of the FY19 award vested. The EPS performance hurdle of -21.1 cents per
share was below the threshold of 27.6 cents per share and target of 31 cents per share, and accordingly none of the EPS
component of the FY19 award vested. The ROIC outcome of -3.2% was below the threshold of 8.8% and target of 9.2%,
resulting in no vesting of performance rights for this component.
The FY20 award, due to be tested on 25 September 2023, has EPS, TSR and ROIC performance hurdles each comprising
one third of the award outcome. Details of the performance outcomes relative to target and threshold amounts will be
provided to shareholders ahead of the 2023 AGM and reported in the FY24 Remuneration Report.
Table 10 summarises the unvested performance rights held by Executive KMP as at 30 June 2023.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT TABLE 10: PERFORMANCE RIGHTS BY AWARD HELD BY EXECUTIVE KMP AT 30 JUNE 2023
Executive KMP
FY20
Award
FY21
Award
FY22
Award
FY23
Award
Total
performance
rights retained
Current Executive KMP
Robbie Cooke1
–
–
580,383
581,670
1,162,053
Christina Katsibouba2
30,032
73,625
71,293
174,501
349,451
Scott Saunders
Former Executive KMP3
Geoff Hogg
Scott Wharton
–
–
–
–
–
–
–
–
–
169,047
169,047
–
–
–
–
Total performance rights
30,032
73,625
651,676
925,218
1,680,551
1 Total includes one-off long term incentive award of 580,383 approved at 2022 AGM.
2 Performance rights in FY20, FY21 and FY22 reflect those granted prior to her appointment as Chief Financial Officer.
3 All performance rights under the LTI lapsed on termination, as per the performance plan rules.
Table 11 shows movements in the variable remuneration of Executive KMP under the LTI during the period. Details of
the number of performance rights granted, vested or lapsed during the period are also provided as required under the
Corporations Act and its regulations, including the relevant Australian Accounting Standard principles.
TABLE 11: VARIABLE REMUNERATION UNDER THE LTI FOR THE YEAR ENDED 30 JUNE 2023
Executive
Financial
Year
Number of
Performance
Rights
Granted
Fair Value of
Performance
Rights
Granted
Fair Value
at Grant
Date
Effective
Grant
Date1
Test Date
As a % of
total
remuneration2
Number of
Performance
Rights
Vested
Number of
Performance
Rights
Lapsed3
Current Executive KMP
Robbie Cooke
2023
581,670
1,353,352
2.33
23/09/2022 23/09/2025
7%
20234
2022
580,383
1,255,562
2.16
23/09/2022 23/09/2025
–
–
–
–
–
Christina
Katsibouba
2023
174,501
406,006
2.33
26/09/2022 26/09/2026
2022
71,293
269,450
3.78
23/09/2021 23/09/2025
Scott Saunders
2023
169,047
393,316
2.33
26/09/2022 26/09/2026
2022
Former Executive KMP
Geoff Hogg
2023
–
–
–
–
–
–
–
–
–
–
2022
108,919
408,254
3.78
23/09/2021 23/09/2025
Scott Wharton
2023
345,366
803,552
2.33
26/09/2022 26/09/2026
2022
–
–
–
–
–
–
–
2%
8%
2%
–
-16%
-2%
0%
–
TOTAL FY23
1,850,967
4,211,788
TOTAL FY22
180,212
677,704
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(20,145)
–
–
–
(403,928)
(82,500)
(345,366)
–
(769,439)
(82,500)5
1 The Effective Grant Date is the date used to determine the VWAP and commencement of TSR performance hurdle measurement.
2 Percentage calculation based on accounting LTI expense and total remuneration as reported in Table 13.
3 Performance rights granted in FY19 were tested in October 2022 and 100% of the award lapsed. Performance rights granted in FY20 are
due for testing in October 2023. All of Mr Hogg and Mr Wharton’s rights lapsed on their termination.
4 One off long term incentive award approved at 2022 AGM.
5 The total for FY22 of (82,500) is different to the total in the FY22 Remuneration Report of (1,659,747) as it does not include (627,706) for
Matt Bekier, (31,818) for Harry Theodore and (917,723) for Greg Hawkins.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
06. EXECUTIVE KMP CONTRACTS AND
REMUNERATION
Remuneration arrangements for Executive KMP are reviewed annually by the Board. Table 12 outlines the remuneration
arrangements for Executive KMP in FY23 and their contracted employment details.
TABLE 12: EXECUTIVE KMP REMUNERATION AND EMPLOYMENT CONTRACTS
CURRENT
EXECUTIVE KMP
Contract Details
Robbie Cooke
Managing Director and
Chief Executive Officer
Christina Katsibouba
Chief Financial Officer
Scott Saunders
Executive KMP
FY22
FY23
FY22
FY23
FY22
FY23
Fixed remuneration1
N/A
$1,600,000 $800,000
$800,000
N/A
$775,000
Short-term
incentive target
Long-term incentive
(annual award value)
Total Target
Annual Reward
Short-term incentive
maximum value
Long-term incentive
maximum value
Non-monetary
benefits
Other benefits
Notice by the
Executive
N/A
N/A
N/A
N/A
N/A
N/A
N/A
12 months
Notice by the Group
12 months
Restraint2
12 months
Non solicitation
12 months
$960,000
$400,000
$480,000
N/A
$465,000
$1,600,000 $480,000
$480,000
N/A
$465,000
$4,160,000 $1,680,000
$1,760,000
N/A
$1,705,000
$1,440,000 $600,000
$720,000
N/A
$697,500
$1,600,000 $480,000
$480,000
N/A
$465,000
N/A
N/A
9 months
9 months
12 months
12 months
N/A
N/A
6 months
6 months
12 months
12 months
Contract duration
Open ended
Open ended
Open ended
FORMER
EXECUTIVE KMP
Contract Details
Geoff Hogg
Acting Chief Executive
Officer
Scott Wharton Chief
Executive Officer
The Star Sydney and Group
Head of Transformation
FY22
FY23
FY22
FY23
Fixed remuneration1
$1,000,000 $1,000,000 N/A
$950,000
$600,000
$600,000
N/A
$570,000
$600,000
$600,000
N/A
$950,000
$2,200,000 $2,200,000 N/A
$2,470,000
$900,000
$900,000
N/A
$855,000
$600,000
$600,000
N/A
$950,000
Short-term
incentive target
Long-term incentive
(annual award value)
Total Target
Annual Reward
Short-term incentive
maximum value
Long-term incentive
maximum value
Non-monetary
benefits
Other benefits
Notice by the
Executive
N/A
N/A
6 months
Notice by the Group
9 months
Restraint2
12 months
Non solicitation
12 months
N/A
N/A
9 months
9 months
12 months
12 months
Contract duration
Open ended
Open ended
1 The Star Entertainment Group deducts superannuation from the Executives’ fixed remuneration as per the Australian Taxation Office
Superannuation Guarantee Cap.
2 Exclusion from being engaged in any business or activity in Australia which competes with or is substantially similar to the business
of The Star Entertainment Group.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT 07. STATUTORY EXECUTIVE KMP REMUNERATION
Table 13 sets out Executive KMP remuneration as required by the Corporations Act and its regulations, including the
relevant Australian Accounting Standard principles.
TABLE 13: STATUTORY EXECUTIVE KMP REMUNERATION
Executive
Financial
year
Short-term
Long-term Post-Employment
Charge for share
based allocations
Termination
payments6
Total
remuneration
Performance
related
Salary1
Bonus
Current Executive KMP
$
Robbie
Cooke
Christina
Katsibouba
Scott
Saunders
2023
1,204,298
2022
–
2023
816,665
2022
124,043
2023
683,249
2022
–
Former Executive KMP
Geoff Hogg
2023
254,648
$
–
–
–
–
–
–
–
Non-monetary
benefits2
$
Long service
leave
$
Superannuation3
$
Performance
rights4
$
Restricted
shares5
$
3,478
–
3,861
840
1,079
–
1,511
–
15,276
1,936
393
–
18,969
92,252
–
–
25,292
18,202
3,076
12,646
–
11,251
11,270
–
–
–
–
–
–
–
–
–
–
–
–
–
$
1,320,508
–
879,296
141,146
708,637
–
%
7%
–
2%
8%
2%
–
5,337
20,580
18,969
(149,829)
(31,808)
807,097
924,994
-16%
2022
849,664
137,835
5,364
16,397
23,568
(19,746)
31,808
Scott
Wharton
2023
709,968
2022
–
TOTAL FY23
3,668,828
–
–
–
2,171
–
–
–
25,292
–
–
–
–
–
15,926
37,760
101,168
(28,105)
(31,808)
807,097
4,570,866
–
–
–
1,044,890
737,431
–
14%
0%
–
–
–
TOTAL FY22
973,707
137,835
6,204
18,333
26,644
(8,495)
31,808
–
1,186,0367
1 Comprises salary, salary sacrificed benefits (including motor vehicle novated leases) and annual leave expense.
2 Comprises car parking, accommodation, airfares and travel costs where applicable. These amounts are non-contractual.
3 Comprises superannuation contributions per Superannuation Guarantee legislation and salary sacrificed superannuation.
4 Represents the fair value of share based payments expensed / (credited) by The Star Entertainment Group in relation to LTI awards.
The reduction in the expense in FY22 is due to the adjustment made under the accounting standards to reflect the probability of
these rights vesting. The reduction in the expense in FY23 is due to the forfeiture of rights on termination.
5 Represents the fair value of share based payments expensed by The Star Entertainment Group in relation to STI awards. The expense
is recognised over a 26 month holding lock period.
6 Termination payments include salary, annual leave, long service leave and other on costs expected to be incurred between the
executiveʼs resignation date and expected termination date. The termination expense for Geoff Hogg includes payment of contract
termination provisions relating to his notice period of which $488,179 was paid as salary while on ‘gardening leaveʼ and available to assist
the Company plus $250,000 in lieu of the remainder of his notice period on his termination in March 2023.
7 The total for FY22 of (1,186,036) is different to the total in the FY22 Remuneration Report of (5,854,086) as it does not include (1,736,128)
for Matt Bekier, (1,507,595) for Harry Theodore and (1,424,327) for Greg Hawkins.
08. NED REMUNERATION
REMUNERATION POLICY
– NEDs (excluding the Chairman) receive a Board fee and a Committee fee for their participation as Chair or member
of each Committee.
– The Chairman receives an all-inclusive fee as Chairman of the Board and as an ex-officio member of all Board
Committees.
– NEDs do not receive any performance or incentive payments and are not eligible to participate in any of the
Group’s reward programs. This policy aligns with the principle that NEDs act independently and impartially.
– Board fees are not paid to the Managing Director and Chief Executive Officer. Executive KMPs do not receive fees for
directorships of any subsidiaries.
NED FEES
The aggregate fees payable to NEDs for their services as directors are limited to the maximum annual amount approved
by shareholders, currently set at $2,500,000 including superannuation contributions.
There was no change to Committee fees in FY23 and there will be no changes to NED or Committee fees for FY24.
Table 14 sets out the annual Board and Committee fee structure for FY23.
43
The Star Entertainment Group 2023 Annual Report
84
43
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT TABLE 14: ANNUAL NED FEES (INCLUSIVE OF SUPERANNUATION)
Board
Audit
Risk, Compliance
and Regulatory
Performance
Remuneration
and People
Safer Gaming,
Governance and
Ethics
Chair
Member
$501,458
$168,912
$35,000
$17,500
$35,000
$17,500
$35,000
$17,500
$35,000
$17,500
The People, Culture and Social Responsibility Committee was renamed as the Remuneration and People Committee from
1 February 2023. The Safer Gaming, Governance and Ethics Committee commenced 1 February 2023.
Individuals invited to join the Board prior to receipt of all required regulatory approvals are not immediately appointed as
NEDs. They are observers until such time as they are appointed to the Board (“Board Observers”). Board Observers receive
the equivalent of directors’ fees and committee fees as determined by the Board.
Table 15 sets out total remuneration received by each NED.
TABLE 15: NED REMUNERATION1
NED
Financial
year
Board and
Committee Fees
$
Superannuation2
Total3
$
$
Current Non-Executive Directors
David Foster
Anne Ward
Deborah Page AM
Michael Issenberg
2023
2022
2023
2022
2023
2022
2023
20224
Former Non-Executive Directors
Gerard Bradley AO
Katie Lahey AM
Richard Sheppard
Ben Heap
TOTAL FY23
TOTAL FY22
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
172,524
–
126,710
–
62,200
–
203,883
51,185
66,791
193,795
100,186
201,219
78,935
193,795
357,124
230,590
1,168,353
850,584
12,816
–
13,305
–
6,531
–
22,519
5,119
7,013
19,380
10,520
20,122
8,288
19,380
18,969
21,380
99,961
85,381
185,340
–
140,015
–
68,731
–
226,402
56,304
73,804
213,175
110,706
221,341
87,223
213,175
376,093
251,970
1,268,314
955,9655
1 The Group agrees to indemnify directors and officers against any liabilities incurred in the course of their duties. During the year, the
group provided for an estimate of legal costs of the 11 former directors and officers in relation to civil penalty proceedings commenced
by ASIC in the Federal Court of Australia. These are considered a post employment benefit but are unable to be apportioned to
individuals and relate to periods beyond their employment with the group. As a result, any post employment benefit related to the
indemnity has been excluded from the table above.
2 Comprises superannuation contributions per Superannuation Guarantee legislation and salary sacrificed superannuation.
3 During FY23, NEDs accepted a 10% reduction in fees in May and June in recognition of the cost reductions applied across the business.
4 Observer fees received in FY22.
5 Total for FY22 of 955,965 is different to the total in the FY22 Remuneration Report of 2,034,505 as it does not include 857,199 for
John O’Neill and 221,341 for Sally Pitkin.
MINIMUM SHAREHOLDING POLICY FOR NEDS
To support the alignment of the interests of the Board and executives with the interests of shareholders, the Group has
minimum shareholding policies in place. NEDs are required to progressively acquire shares over a three year period from
the date of commencement of their unconditional appointment (within three years from the date of commencement of the
policy (for existing directors). NEDs are to hold shares of equal value to their respective annual base fee applicable at the
time of their unconditional appointment. Direct and indirect holdings will count towards the minimum shareholding target.
All NEDs are on track to meet their minimum shareholding requirements in the required timeframes.
The Star Entertainment Group 2023 Annual Report
44
44
85
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
TABLE 16: SHARES HELD BY NEDS AT 30 JUNE 2023
Name
Balance at
start of the year1
Number
acquired
Number
divested
Balance at the
end of the year2
Current Non-Executive Directors
David Foster
4,407
Michael Issenberg
Anne Ward
Deborah Page AM
Former Non-Executive Directors
Gerard Bradley AO
Katie Lahey AM
Richard Sheppard
Ben Heap
Total ordinary shares
–
–
–
75,000
56,907
300,000
50,000
486,314
9,541
20,000
–
35,500
–
–
–
30,000
95,041
–
–
–
–
–
–
–
–
–
13,948
20,000
–
35,500
75,000
56,907
300,000
80,000
581,355
1 For NEDs who commenced their role during the year, the balance disclosed is from the date they commenced as a NED.
2 For NEDs who ceased their role during the year, the balance disclosed is to the date they ceased as a NED.
09. OTHER INFORMATION
9.1. LOANS AND OTHER TRANSACTIONS WITH KMP
There have been no loans or other transactions with KMP during the year.
45
The Star Entertainment Group 2023 Annual Report
86
45
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2023
THE STAR ENTERTAINMENT GROUP LIMITED
ACN 149 629 023
ASX Code: SGR
and its controlled entities
87
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 30 JUNE 2023
Revenue
Other income
Government taxes and levies
Employment costs
Depreciation, amortisation and impairment
Cost of sales
Property costs
Advertising and promotions
Regulatory and legal costs
Other expenses
Share of net profit of associate and joint venture entities accounted for
using the equity method
LLoossss bbeeffoorree iinntteerreesstt aanndd iinnccoommee ttaaxx ((LLBBIITT))
Net finance costs
LLoossss bbeeffoorree iinnccoommee ttaaxx ((LLBBTT))
Income tax benefit
NNeett lloossss aafftteerr ttaaxx ((NNLLAATT))
OOtthheerr ccoommpprreehheennssiivvee ((lloossss))//iinnccoommee
Items that may be reclassified subsequently to profit or loss
Change in fair value of cash flow hedges taken to equity, net of tax
TToottaall ccoommpprreehheennssiivvee lloossss ffoorr tthhee ppeerriioodd
LLoossss ppeerr sshhaarree::
Basic loss per share
Diluted loss per share
NNoottee
A2
A3
A3
A3
A4
B7
D5
A5
F2
22002233
$$mm
11,,886677..55
11..00
((445566..11))
((773377..00))
((22,,336633..11))
((9955..55))
((7722..22))
((6688..88))
((559944..88))
((113399..44))
55..44
((22,,665533..00))
((111100..00))
((22,,776633..00))
332277..88
22002222
$$mm
1,527.1
15.0
(379.0)
(598.7)
(370.8)
(77.1)
(60.2)
(64.5)
(30.1)
(131.4)
16.4
(153.3)
(52.3)
(205.6)
3.1
((22,,443355..22))
(202.5)
F1
((66..55))
20.5
((22,,444411..77))
(182.0)
F3
F3
((221111..77)) cceennttss
((221111..77)) cceennttss
(21.3) cents
(21.3) cents
The above consolidated income statement should be read in conjunction with the accompanying notes.
46
88
46
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT CONSOLIDATED BALANCE SHEET
FOR THE YEAR ENDED 30 JUNE 2023
AASSSSEETTSS
Cash and cash equivalents
Trade and other receivables
Inventories
Income tax receivable
Derivative financial instruments
Other assets
TToottaall ccuurrrreenntt aasssseettss
Property, plant and equipment
Intangible assets
Derivative financial instruments
Investment in associate and joint venture entities
Deferred tax assets
Other assets
TToottaall nnoonn ccuurrrreenntt aasssseettss
TTOOTTAALL AASSSSEETTSS
LLIIAABBIILLIITTIIEESS
Trade and other payables
Interest bearing liabilities
Provisions
Derivative financial instruments
Other liabilities
TToottaall ccuurrrreenntt lliiaabbiilliittiieess
Interest bearing liabilities
Deferred tax liabilities
Provisions
Other liabilities
TToottaall nnoonn ccuurrrreenntt lliiaabbiilliittiieess
TTOOTTAALL LLIIAABBIILLIITTIIEESS
NNEETT AASSSSEETTSS
EEQQUUIITTYY
Share capital
(Accumulated losses)/ retained earnings
Reserves
TTOOTTAALL EEQQUUIITTYY
The above consolidated balance sheet should be read in conjunction with the accompanying notes.
NNoottee
B1
B2
F2
B3
F4
B4
B5
B3
D5
F2
F4
F5
B8
B7
B3
F6
B8
F2
B7
F6
F7
F7
22002233
$$mm
8888..77
2200..88
1144..99
3300..88
22..66
9933..77
225511..55
11,,775522..33
333322..88
3377..44
666699..22
119900..44
2266..77
33,,000088..88
33,,226600..33
118844..99
66..00
550055..77
33..88
1188..66
771199..00
775511..22
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88..00
1111..11
777700..33
11,,448899..33
11,,777711..00
33,,995555..66
((22,,118877..44))
22..88
11,,777711..00
22002222
$$mm
82.0
18.0
16.2
4.4
1.4
79.5
201.5
2,635.5
1,662.0
62.9
669.6
-
39.9
5,069.9
5,271.4
206.4
6.1
115.2
5.7
23.1
356.5
1,326.4
140.9
8.3
9.0
1,484.6
1,841.1
3,430.3
3,171.0
247.8
11.5
3,430.3
47
47
89
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023
CCaasshh fflloowwss ffrroomm ooppeerraattiinngg aaccttiivviittiieess
Net cash receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Payment of government levies, gaming taxes and GST
Interest received
Income taxes paid
Regulatory, fines, penalties, duty, consultant, legal and other costs
NNeett ccaasshh iinnffllooww ffrroomm ooppeerraattiinngg aaccttiivviittiieess
CCaasshh fflloowwss ffrroomm iinnvveessttiinngg aaccttiivviittiieess
Payments for property, plant, equipment and intangibles
Proceeds from sale of plant and equipment
Payments for investment in associate and joint venture entities
Loans to joint venture entities
Distributions received from joint venture entities
NNeett ccaasshh oouuttffllooww ffrroomm iinnvveessttiinngg aaccttiivviittiieess
CCaasshh fflloowwss ffrroomm ffiinnaanncciinngg aaccttiivviittiieess
Proceeds from interest bearing liabilities
Repayment of interest bearing liabilities
Proceeds from settlement of derivative financial instruments
Finance costs
Purchase of treasury shares
Proceeds from issue of shares
Interest payment of lease liabilities
Principal payment of lease liabilities
NNeett ccaasshh iinnffllooww//((oouuttffllooww)) ffrroomm ffiinnaanncciinngg aaccttiivviittiieess
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of the year
CCaasshh aanndd ccaasshh eeqquuiivvaalleennttss aatt eenndd ooff tthhee yyeeaarr
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
48
90
NNoottee
22002233
$$mm
22002222
$$mm
F2
F8
E2
E2
E2
F7
F7
E2
E2
B1
11,,998866..66
((11,,227777..55))
((446611..77))
00..88
((2200..00))
((118844..44))
1,665.9
(1,054.6)
(412.6)
-
(5.1)
(17.4)
4433..88
176.2
((113355..33))
00..55
((1199..55))
((66..33))
2255..44
((113355..22))
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2200..55
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((66..44))
777788..55
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((66..55))
9988..11
66..77
8822..00
8888..77
(142.8)
40.8
(21.7)
-
-
(123.7)
125.9
(104.0)
-
(48.9)
(1.9)
-
(3.5)
(6.0)
(38.4)
14.1
67.9
82.0
48
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT mm
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t
s
d
e
t
a
d
i
l
o
s
n
o
c
e
v
o
b
a
e
h
T
49
91
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
56
56
57
58
60
61
64
68
51
52
52
53
53
54
54
55
Refer to the Operating and Financial Review (OOFFRR) within the Directors' Report for details of the key transactions during the year.
CONTENTS
A KEY INCOME STATEMENT DISCLOSURES
A1 SEGMENT INFORMATION
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
A2 REVENUE
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
A3 OTHER INCOME AND EXPENSES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
A4 DEPRECIATION, AMORTISATION AND IMPAIRMENT
A5 NET FINANCE COSTS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
A6 DIVIDENDS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
A7 SIGNIFICANT ITEMS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
A8 LEASES
B KEY BALANCE SHEET DISCLOSURES
B1 CASH AND CASH EQUIVALENTS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
B2 TRADE AND OTHER RECEIVABLES
B3 DERIVATIVE FINANCIAL INSTRUMENTS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
B4 PROPERTY, PLANT AND EQUIPMENT
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
B5 INTANGIBLE ASSETS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
B6 IMPAIRMENT TESTING AND GOODWILL
B7 PROVISIONS, CONTINGENT LIABILITIES AND REGULATORY MATTERS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
B8 INTEREST BEARING LIABILITIES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
C COMMITMENTS AND SUBSEQUENT EVENTS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
C1 COMMITMENTS
C2 SUBSEQUENT EVENTS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
D GROUP STRUCTURES
D1 RELATED PARTY DISCLOSURES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
D2 PARENT ENTITY DISCLOSURES
D3 DEED OF CROSS GUARANTEE
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
D4 KEY MANAGEMENT PERSONNEL DISCLOSURES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
D5 INVESTMENT IN ASSOCIATE AND JOINT VENTURE ENTITIES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
E RISK MANAGEMENT
E1 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
E2 ADDITIONAL FINANCIAL INSTRUMENTS DISCLOSURES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
F OTHER DISCLOSURES
F1 OTHER COMPREHENSIVE INCOME
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
F2 INCOME TAX
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
F3 LOSS PER SHARE
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
F4 OTHER ASSETS
F5 TRADE AND OTHER PAYABLES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
F6 OTHER LIABILITIES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
F7 SHARE CAPITAL AND RESERVES
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
F8 RECONCILIATION OF NET PROFIT AFTER TAX TO NET CASH INFLOWS FROM OPERATIONS
F9 EMPLOYEE SHARE PLANS
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
F10 AUDITOR'S REMUNERATION
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
G ACCOUNTING POLICIES AND CORPORATE INFORMATION
................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
88
88
91
91
91
92
92
94
95
96
72
74
76
77
78
82
86
70
70
97
50
92
50
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
A
KEY INCOME STATEMENT DISCLOSURES
A1 SEGMENT INFORMATION
The Group's operating segments have been determined based on the internal management reporting structure and the
nature of products and services provided by the Group. They reflect the business level at which financial information is
provided to those in the roles of executive decision makers, being the Managing Director and Chief Executive Officer and the
Chief Financial Officer, for decision making regarding resource allocation and performance assessment.
The Group has three reportable segments:
SSyyddnneeyy
GGoolldd CCooaasstt
BBrriissbbaannee
Comprises The Star Sydney's casino operations, including hotels, restaurants, bars and other entertainment
facilities.
Comprises The Star Gold Coast's casino operations, including hotels, theatre, restaurants, bars and other
entertainment facilities.
Comprises casino operations, including hotel, restaurants and bars.
22002233
Gross revenues - VIP a
Gross revenues - domestic a
SSeeggmmeenntt rreevveennuuee
SSeeggmmeenntt
ddeepprreecciiaattiioonn,, aammoorrttiissaattiioonn aanndd ssiiggnniiffiiccaanntt iitteemmss
eeaarrnniinnggss
iinntteerreesstt,,
bbeeffoorree
ttaaxx,,
DDeepprreecciiaattiioonn aanndd aammoorrttiissaattiioonn ((rreeffeerr ttoo nnoottee AA44))
CCaappiittaall eexxppeennddiittuurree
22002222
Gross revenues - VIP a
Gross revenues - domestic a
Segment revenue
Segment earnings before interest, tax, depreciation,
amortisation and significant items
Depreciation and amortisation (refer to note A4)
Capital expenditure
SSyyddnneeyy
$$mm
--
998844..00
998844..00
112277..22
110099..00
8855..44
4.7
778.8
783.5
83.4
118.3
60.8
GGoolldd CCooaasstt
$$mm
BBrriissbbaannee
$$mm
--
550088..99
550088..99
110077..00
6600..66
3377..66
0.6
423.8
424.4
89.3
63.1
65.2
--
337744..66
337744..66
8833..22
2255..77
1122..99
0.2
326.0
326.2
64.8
26.9
13.6
TToottaall
$$mm
--
11,,886677..55
11,,886677..55
331177..44
119955..33
113355..99
5.5
1,528.6
1,534.1
237.5
208.3
139.6
a
Total gross revenue is presented as the gross gaming win before player rebates and promotional allowances of nil (2022: $7.0 million).
RReeccoonncciilliiaattiioonn ooff rreeppoorrttaabbllee sseeggmmeenntt pprrooffiitt ttoo pprrooffiitt bbeeffoorree iinnccoommee ttaaxx
Segment earnings before interest, tax, depreciation, amortisation and significant
items
Depreciation and amortisation (refer to note A4)
Significant items (refer to note A7)
Unallocated items:
- net finance costs a (refer to note A5)
- share of net loss of associate and joint venture entities accounted for using
the equity method a (refer to note D5)
LLoossss bbeeffoorree iinnccoommee ttaaxx ((LLBBTT))
a These items are before significant items (refer to note A7).
22002233
$$mm
331177..44
((119955..33))
((22,,882244..88))
22002222
$$mm
237.5
(208.3)
(176.0)
((5566..55))
(50.2)
((33..88))
((22,,776633..00))
(8.6)
(205.6)
51
51
93
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
A2 REVENUE
Gaming
Non-gaming
Other
TToottaall rreevveennuuee
22002233
$$mm
11,,226600..00
559966..22
1111..33
11,,886677..55
22002222
$$mm
1,070.7
448.1
8.3
1,527.1
Revenue
Revenue is recognised when the Group satisfies its obligations in relation to the provision of goods and services to its
customers in the ordinary course of business. Revenue is measured at an amount that reflects the consideration to which
the Group expects to be entitled in exchange for performing these obligations, including any discounts, rebates, price
concessions, incentives or performance bonuses. Revenue is constrained such that the significant reversal of revenue in a
future period is not highly probable. Revenue comprises net gaming win, less player and gaming promoter rebates and
promotional allowances, as well as other non-gaming revenue from hotels, restaurants and bars.
Customer loyalty programs
The Group operates customer loyalty programs enabling customers to accumulate award credits for on-property spend. A
portion of the spend, equal to the fair value of the award credits earned and reduced for expected breakage, is treated as
deferred revenue (refer to note F6). Revenue from the award credits is recognised in the income statement when the award
is redeemed or expires. The stand alone selling price of complimentary services (including hotel room nights, food and
beverage, and other services) that are provided to casino guests as incentives related to gaming play are recorded as
revenues related to the respective goods or services, as they are provided to the patron. The residual amount is recorded as
gaming revenue.
A3 OTHER INCOME AND EXPENSES
Loss before income tax is stated after charging the following expenses and significant items:
Other income
Gain on disposal of assets a
Net foreign exchange gain
Other
22002233
$$mm
00..88
00..22
--
11..00
a In the prior comparable period (ppccpp), the gain on disposal of assets includes the disposal of the Jet. Refer to note A7.
Government taxes and levies (including gaming GST):
New South Wales
Queensland
Employment costs:
Salaries, wages, bonuses, redundancies and other benefits
Defined contribution plan expense (superannuation guarantee charges)
Share based payment expense (refer to note F9)
227711..33
118844..88
445566..11
667777..11
5577..33
22..66
773377..00
22002222
$$mm
10.1
0.1
4.8
15.0
211.2
167.8
379.0
554.6
44.9
(0.8)
598.7
52
52
94
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
A4 DEPRECIATION, AMORTISATION AND IMPAIRMENT
Property, plant and equipment (refer to note B4)
Intangible assets (refer to note B5)
Other
TToottaall ddeepprreecciiaattiioonn aanndd aammoorrttiissaattiioonn
Impairment - Property, plant and equipment (refer to note B6)
Impairment - Goodwill (refer to note B6)
Impairment - Intangible assets (refer to note B6)
Impairment - Other (refer to note B6)
TToottaall iimmppaaiirrmmeenntt (refer to note A7)
TToottaall ddeepprreecciiaattiioonn,, aammoorrttiissaattiioonn aanndd iimmppaaiirrmmeenntt
22002233
$$mm
116611..00
3333..33
11..00
119955..33
881177..99
11,,115500..99
118844..33
1144..77
22,,116677..88
22,,336633..11
22002222
$$mm
171.5
36.2
0.6
208.3
-
162.5
-
-
162.5
370.8
Depreciation is calculated using a straight line method. The useful lives over which the assets are depreciated are as follows
(for further details of the useful lives of intangible assets refer to note B5):
10 - 95 years
Freehold and leasehold buildings
4 - 75 years
Leasehold improvements
5 - 20 years
Plant and equipment
3 - 10 years
Software
Until expiry
Licences
Operating equipment (which includes uniforms, casino chips, kitchen utensils, crockery, cutlery and linen) is recognised as a
depreciation expense based on usage. The period of usage depends on the nature of the operating equipment.
Right of use assets, which includes plant, equipment and property, is depreciated on a straight line basis over the shorter of
its estimated useful life and the lease term. The Group's lease portfolio includes assets with lease terms between 1 and 75
years. The residual values and useful lives are reviewed annually, and adjusted if appropriate, at each financial reporting
date.
A5 NET FINANCE COSTS
Interest paid on borrowings
Borrowing costs
Debt modification
Derivative settlement
Fair value hedging adjustment
Interest income
Leases interest
NNeett ffiinnaannccee ccoossttss rreeccooggnniisseedd iinn tthhee iinnccoommee ssttaatteemmeenntt aa
22002233
$$mm
4433..44
1188..33
3300..00
1155..66
00..44
((00..88))
33..11
111100..00
22002222
$$mm
37.6
13.3
-
-
(2.1)
-
3.5
52.3
a
Net finance costs include the following significant items (refer to note A7) $30.0 million of debt modifications, $15.6 million of
derivative settlement costs (comprising $8.1 million released from fair value adjustments held against debt, $6.7 million released from
cash flow hedge reserves and $0.8 million transaction costs) and $7.9 million of borrowing amendment fees. In the pcp, net finance
costs included $2.1 million of finance costs associated with COVID-19 affected loan facilities.
53
53
95
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
A6 DIVIDENDS
NNoo ffiinnaall ddiivviiddeenndd wwaass ddeeccllaarreedd iinn aaccccoorrddaannccee wwiitthh tthhee ccoonnddiittiioonnss ooff ddeebbtt ccoovveennaanntt wwaaiivveerrss wwhhiicchh rreessttrriicctt ffuurrtthheerr ccaasshh
ddiivviiddeennddss ffrroomm bbeeiinngg ppaaiidd uunnttiill tthhee GGrroouupp’’ss ggeeaarriinngg,, wwhhiicchh rreepprreesseennttss tthhee rraattiioo ooff nneett ddeebbtt ttoo 1122 mmoonntthh ttrraaiilliinngg ssttaattuuttoorryy
EEBBIITTDDAA,, iiss bbeellooww 22..55 ttiimmeess,, tthhee GGrroouupp rreettuurrnnss ttoo ssuuiittaabbiilliittyy aanndd aallll ooff tthhee GGrroouupp''ss ccaassiinnoo lliicceenncceess aarree iinn ffuullll ffoorrccee aanndd
eeffffeecctt..
22002233
$$mm
111111..88
22002233
$$mm
22,,116677..88
559944..88
5533..55
1166..11
--
11..88
--
((99..22))
--
22,,882244..88
((334488..33))
22,,447766..55
22002222
$$mm
92.0
22002222
$$mm
162.5
30.1
2.1
-
9.8
7.7
2.7
(34.2)
(4.7)
176.0
(5.2)
170.8
FFrraannkkiinngg ccrreeddiitt bbaallaannccee
Amount of franking credits available to shareholders
A7 SIGNIFICANT ITEMS
Loss before income tax (LBT) is stated after charging the following significant items:
Impairment a
Regulatory, fines, penalties, duty, consultant, legal and other costs b
Debt refinancing costs c
Redundancy costs d
One-off COVID-19 related expenditure e
Accounting for software change f
Business Interruption and Crown unsolicited proposal costs g
Profit on sale of assets h
Dispute settlement i
NNeett ssiiggnniiffiiccaanntt iitteemmss
Tax on significant items
SSiiggnniiffiiccaanntt iitteemmss nneett ooff ttaaxx
a
b
c
Impairment of goodwill, property, plant & equipment, intangibles and other non-current assets (refer to note B6).
Regulatory, fines, penalties, underpaid casino duty, consultant, legal, Manager, Special Manager and other costs.
Debt modification, derivative settlement costs and borrowing amendment fees. In the pcp, costs associated with COVID-19 affected
loan facilities.
Redundancy costs relating to Group reorganisation.
Incremental one-off COVID-19 related expenditure including support payments for employees impacted by property shutdowns.
Software-as-a-Service (SaaS) arrangement project implementation costs. Major projects include the implementation of new payroll
and customer management Salesforce systems.
Business Interruption insurance claim and adviser costs related to the unsolicited Crown Resorts bid.
Equity accounted share of Destination Gold Coast Consortium's profit relating to the sale of Tower 1 residential units and Destination
Sydney Consortium's profit on the NSW Government's compulsory acquisition of its Pyrmont property. In the pcp, equity accounted
share of Destination Gold Coast Consortium's profit relating to the sale of Tower 1 residential units and the sale of the second
Bombardier Jet completed.
The Group settled a dispute with suppliers, resulting in recovery of $4.7 million in funds in relation to combustible cladding claims.
d
e
f
g
h
i
Significant items are determined by management based on their nature and size. They are items of income or expense which
are, either individually or in aggregate, material to the Group or to the relevant business segment and:
not in the ordinary course of business (for example, the cost of significant reorganisations or restructuring); or
part of the ordinary activities of the business but unusual due to their size and nature (for example, impairment of
assets).
54
96
54
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
A8 LEASES
The following amounts relating to AASB16 leases are recognised in the income statement:
Depreciation expense of right-of-use assets (refer to note B4)
Interest expense on lease liabilities (refer to note A5)
TToottaall
22002233
$$mm
55..77
33..11
88..88
22002222
$$mm
6.0
3.5
9.5
55
55
97
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
B
KEY BALANCE SHEET DISCLOSURES
ASSETS
B1 CASH AND CASH EQUIVALENTS
Cash on hand and in banks
Short term deposits, maturing within 30 days
B2 TRADE AND OTHER RECEIVABLES
Trade receivables
Less provision for impairment
Net trade receivables
Other receivables
(i) PROVISION FOR IMPAIRMENT RECONCILIATION
Balance at beginning of year
Impairment of trade receivables a
Less amounts written off as uncollectible
a
These amounts are included in other expenses in the income statement.
Trade receivables are non-interest bearing and are generally on 30 day terms.
(ii) AGEING OF TRADE AND OTHER RECEIVABLES
22002233
$$mm
7799..22
99..55
8888..77
3377..77
((3333..00))
44..77
1166..11
2200..88
((3377..00))
((11..00))
55..00
((3333..00))
00 -- 3300 ddaayyss
3300 ddaayyss -- 11
yyeeaarr
11 -- 33 yyeeaarrss
$$mm
$$mm
$$mm
33 yyeeaarrss ++
$$mm
44..77
--
--
44..77
6.5
0.3
-
6.8
--
--
--
--
-
-
2.0
2.0
--
--
22..44
22..44
-
-
26.4
26.4
--
--
3300..66
3300..66
-
1.0
8.6
9.6
TTrraaddee rreecceeiivvaabblleess
22002233
Not yet due
Past due not impaired
Considered impaired
22002222
Not yet due
Past due not impaired
Considered impaired
56
98
22002222
$$mm
82.0
-
82.0
44.8
(37.0)
7.8
10.2
18.0
(38.1)
(1.0)
2.1
(37.0)
TToottaall
$$mm
44..77
--
3333..00
3377..77
6.5
1.3
37.0
44.8
56
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
OTHER RECEIVABLES
Other receivables are not past due or considered impaired. It is expected that these balances will be received as they fall
due.
IImmppaaiirrmmeenntt ooff ttrraaddee rreecceeiivvaabblleess
The Group impairment analysis is performed at each reporting date to measure expected credit losses. The provision reflects
the probability-weighted outcome of reasonable and supportable information that is available at the reporting date about
past events, current conditions and forecasts of future economic conditions.
Debtor balances have been individually assessed based on criteria, including: patron's financial circumstances; payment
history; relationship with the Group; international gambling activity; and whether a legal claim has commenced to collect the
balance.
B3 DERIVATIVE FINANCIAL INSTRUMENTS
CCuurrrreenntt aasssseettss
Interest rate swaps
NNoonn ccuurrrreenntt aasssseettss
Cross currency swaps
Interest rate swaps
CCuurrrreenntt lliiaabbiilliittiieess
Cross currency swaps
22002233
$$mm
22..66
22..66
3366..55
00..99
3377..44
33..88
33..88
22002222
$$mm
1.4
1.4
59.6
3.3
62.9
5.7
5.7
58.6
NNeett ffiinnaanncciiaall aasssseettss
NNeett ddeerriivvaattiivveess aarree ddoowwnn $$2222..44 mmiilllliioonn.. IInn MMaarrcchh 22002233,, tthhee ccrroossss ccuurrrreennccyy iinntteerreesstt rraattee sswwaappss uusseedd ttoo hheeddggee UUSSPPPP
rreellaatteedd rriisskkss wweerree aammeennddeedd,, rreessuullttiinngg iinn aa nneett sseettttlleemmeenntt iinnccoommee ooff $$2200..55 mmiilllliioonn.. TThhee rreemmaaiinniinngg ddeerriivvaattiivveess aallssoo
ddeeccrreeaasseedd $$11..99 mmiilllliioonn dduuee ttoo uunnffaavvoouurraabbllee oovveerraallll cchhaannggeess iinn tthhee hheeddggeedd rriisskkss..
3366..22
VVaalluuaattiioonn ooff ddeerriivvaattiivveess aanndd ootthheerr ffiinnaanncciiaall iinnssttrruummeennttss
The valuation of derivatives and financial instruments is based on market conditions at the balance sheet date. The value of
the instrument fluctuates on a daily basis and the actual amounts realised may differ materially from their value at the
balance sheet date.
Refer to note E2 for additional financial instruments disclosure.
57
57
99
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
B4 PROPERTY, PLANT AND EQUIPMENT
22002233
CCoosstt
Opening balance at beginning of the
year
Additions
Disposals / write offs
Reclassification / transfer
Closing balance at end of the year
AAccccuummuullaatteedd ddeepprreecciiaattiioonn
Opening balance at beginning of the
year
Depreciation expense
Disposals / transfers
Impairments
Closing balance at end of the year
CCaarrrryyiinngg AAmmoouunntt
Opening balance at beginning of the
year
Closing balance at end of the year
22002222
CCoosstt
Opening balance at beginning of the
year
Additions
Disposals / write offs
Reclassification / transfer
FFrreeeehhoolldd
llaanndd
FFrreeeehhoolldd aanndd
lleeaasseehhoolldd
bbuuiillddiinnggss
LLeeaasseehhoolldd
iimmpprroovveemmeennttss
PPllaanntt aanndd
eeqquuiippmmeenntt
RRiigghhtt ooff
uussee aasssseett
NNoottee
$$mm
$$mm
$$mm
$$mm
$$mm
TToottaall
$$mm
7744..11
22,,772222..11
330011..22
11,,118888..55
5588..88
44,,334444..77
--
--
--
6611..33
((1111..11))
((1111..44))
00..33
--
00..77
3355..33
((2288..77))
1100..77
--
((00..44))
--
9966..99
((4400..22))
--
7744..11
22,,776600..99
330022..22
11,,220055..88
5588..44
44,,440011..44
A4
A4
--
--
--
--
--
663388..99
6677..77
((99..33))
770088..22
114411..33
99..77
--
33..77
991100..88
7777..99
((2299..00))
9922..55
1188..22
55..77
((00..77))
1133..55
11,,770099..22
116611..00
((3399..00))
881177..99
11,,440055..55
115544..77
11,,005522..22
3366..77
22,,664499..11
7744..11
7744..11
22,,008833..22
11,,335555..44
115599..99
114477..55
227777..77
115533..66
4400..66
2211..77
22,,663355..55
11,,775522..33
72.5
1.6
-
-
2,677.9
305.5
1,159.5
64.6
(10.3)
(10.1)
0.5
(2.1)
(2.7)
43.5
(29.5)
15.0
62.9
0.8
(4.9)
-
4,278.3
111.0
(46.8)
2.2
Closing balance at end of the year
74.1
2,722.1
301.2
1,188.5
58.8
4,344.7
AAccccuummuullaatteedd ddeepprreecciiaattiioonn
Opening balance at beginning of the
year
Depreciation expense
Disposals / transfers
A4
Closing balance at end of the year
CCaarrrryyiinngg AAmmoouunntt
Opening balance at beginning of the
year
Closing balance at end of the year
-
-
-
-
575.7
73.6
(10.4)
638.9
72.5
74.1
2,102.2
2,083.2
134.8
8.0
(1.5)
141.3
170.7
159.9
855.8
83.9
(28.9)
910.8
16.6
6.0
(4.4)
1,582.9
171.5
(45.2)
18.2
1,709.2
303.7
277.7
46.3
40.6
2,695.4
2,635.5
58
100
58
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
a Includes capital works in progress of:
Buildings - at cost
Leasehold improvements - at cost
Plant and equipment - at cost
22002233
$$mm
1133..88
--
44..88
1188..66
Total capital works in progress
FFoorr ddeettaaiillss oonn ccaappiittaall aaccttiivviittiieess rreeffeerr ttoo sseeccttiioonn 22..44 ooff tthhee DDiirreeccttoorrss'' RReeppoorrtt..
Property, plant and equipment is comprised of the following assets:
Freehold land - Gold Coast property;
Freehold and leasehold buildings - Brisbane, Gold Coast and Sydney properties;
Leasehold improvements - Brisbane and Sydney properties;
Plant and equipment - operational and other equipment: and
Right-of-Use assets - Property and other equipment.
AAsssseett uusseeffuull lliivveess aanndd rreessiidduuaall vvaalluueess
For the accounting policy on depreciation and useful lives of property, plant and equipment refer to note A4.
IImmppaaiirrmmeenntt
Refer to note B6 for details of the accounting policy and key assumptions included in the impairment calculation.
22002222
$$mm
19.6
0.3
6.7
26.6
59
59
101
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
B5 INTANGIBLE ASSETS
SSyyddnneeyy aanndd
BBrriissbbaannee
ccaassiinnoo
lliicceenncceess
SSyyddnneeyy ccaassiinnoo
ccoonncceessssiioonnss
SSooffttwwaarree a
$$mm
$$mm
$$mm
NNoottee
GGooooddwwiillll
$$mm
22002233
CCoosstt
Opening balance at beginning of the year
Additions
Disposals / write offs
Reclassification / transfer
11,,444422..22
--
--
--
229944..77
--
--
--
110000..00
--
--
--
331199..22
3399..11
((00..44))
--
OOtthheerr
$$mm
2200..11
--
--
--
TToottaall
$$mm
22,,117766..22
3399..11
((00..44))
--
Closing balance at end of the year
11,,444422..22
229944..77
110000..00
335577..99
2200..11
22,,221144..99
AAccccuummuullaatteedd aammoorrttiissaattiioonn
Opening balance at beginning of the year
Amortisation expense
Disposals
Impairments
A4
A4
Closing balance at end of the year
CCaarrrryyiinngg AAmmoouunntt
Opening balance at beginning of the year
Closing balance at end of the year
22002222
CCoosstt
Opening balance at beginning of the year
Additions
Disposals
Reclassification / transfer
116622..55
--
--
11,,115500..99
11,,331133..44
11,,227799..77
112288..88
1,442.2
-
-
-
8811..88
33..11
--
110000..11
118855..00
221122..99
110099..77
294.7
-
-
-
3322..33
00..99
--
3366..66
6699..88
6677..77
3300..22
223300..55
2288..99
((00..66))
4433..00
330011..88
77..11
00..44
--
44..66
551144..22
3333..33
((00..66))
11,,333355..22
1122..11
11,,888822..11
8888..77
5566..11
1133..00
88..00
11,,666622..00
333322..88
100.0
-
-
-
292.9
29.4
(0.9)
(2.2)
20.1
-
-
-
2,149.9
29.4
(0.9)
(2.2)
Closing balance at end of the year
1,442.2
294.7
100.0
319.2
20.1
2,176.2
AAccccuummuullaatteedd aammoorrttiissaattiioonn
Opening balance at beginning of the year
Amortisation expense
Disposals
Impairments
A4
A4
Closing balance at end of the year
CCaarrrryyiinngg AAmmoouunntt
Opening balance at beginning of the year
Closing balance at end of the year
-
-
-
162.5
162.5
78.6
3.2
-
-
81.8
1,442.2
1,279.7
216.1
212.9
31.4
0.9
-
-
32.3
68.6
67.7
201.8
31.7
(3.0)
-
230.5
6.7
0.4
-
-
7.1
318.5
36.2
(3.0)
162.5
514.2
91.1
88.7
13.4
13.0
1,831.4
1,662.0
Includes capital works in progress of $28.0 million (2022: $17.3 million).
a
IInnttaannggiibbllee aasssseett aaddddiittiioonnss rreellaattee pprreeddoommiinnaannttllyy ttoo ssooffttwwaarree aass tthhee GGrroouupp pprrooggrreesssseess iittss ssttrraatteeggiicc pprriioorriittyy ttoo mmaaxxiimmiissee
vvaalluuee ffrroomm tteecchhnnoollooggyy,, iinncclluuddiinngg ddeevveellooppiinngg tteecchhnnoollooggiieess ttoo eennaabbllee ccoommpplliiaannccee wwiitthh rreegguullaattoorryy rreeqquuiirreemmeennttss aanndd iinn
pprreeppaarraattiioonn ffoorr mmaannddaattoorryy ccaarrddeedd ppllaayy aanndd ccaasshh lliimmiitt cchhaannggeess rreeqquuiirreedd ttoo bbee iinn ppllaaccee iinn AAuugguusstt 22002244 aass wweellll aass
ddeelliivveerriinngg nneeww iinntteeggrraatteedd IITT ppllaattffoorrmmss..
60
102
60
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
AAsssseett uusseeffuull lliivveess aanndd rreessiidduuaall vvaalluueess
Intangible assets are amortised using the straight line method as follows:
The Sydney casino licence is amortised from its date of issue until expiry in 2093.
The Sydney casino concessions granted by the New South Wales government include product concessions in New South
Wales which are amortised over the period of expected benefits.
The Brisbane casino licence is amortised over the remaining life of the lease to which the licence is linked, which expires
in 2070. The Group will continue to amortise the casino licence over its current term up until it is surrendered, following
the expected opening of the entertainment and leisure destination at Queen's Wharf Brisbane (QQWWBB) from April 2024.
Software is amortised over useful lives of 3 to 10 years.
Other assets include the contribution to the construction costs of the state government owned Gold Coast Convention
and Exhibition Centre. The Group's Gold Coast casino is deriving future benefits from the contribution, which is being
amortised over a period of 50 years.
Goodwill and impairment testing
Goodwill is assessed for impairment on an annual basis and is carried at cost less accumulated impairment losses. Refer to
note B6 for the accounting policy on asset impairment and details of key assumptions included in the impairment testing
calculation.
B6 IMPAIRMENT TESTING AND GOODWILL
Goodwill acquired through business combinations has been allocated to the applicable cash generating unit for impairment
testing. Each cash generating unit represents a business operation of the Group.
CARRYING AMOUNT OF GOODWILL ALLOCATED TO EACH CASH GENERATING UNIT
CCaasshh ggeenneerraattiinngg uunniitt
((RReeppoorrttaabbllee sseeggmmeenntt))
22002233
22002222
SSyyddnneeyy
$$mm
-
GGoolldd CCooaasstt
$$mm
-
851.0
165.5
BBrriissbbaannee
$$mm
128.8
263.2
TToottaall ccaarrrryyiinngg
aammoouunntt
$$mm
128.8
1,279.7
The recoverable amount of each of the three cash generating units at year end (Sydney, Gold Coast and Brisbane) is
determined based on 'fair value less costs of disposal', which is calculated using the discounted cash flow approach. This
approach utilises cash flow forecasts that represent a market participant's view of the future cash flows that would arise
from operating and developing the Group's assets. These cash flows are principally based upon Board approved business
plans for a five-year period, together with longer term projections and approved capital investment plans, extrapolated using
an implied terminal growth rate of 2.5% (2022: 2.5%). These cash flows are then discounted using a relevant long term post-
tax discount rate specific to each cash generating unit, ranging between 10.0% to 12.6% (2022: 8.9% to 9.3%). The pre-tax
discount rates range between 11.8% to 15.1% (2022: 11.4% to 11.8%).
AAnn iimmppaaiirrmmeenntt ooff $$22,,116677..88 mmiilllliioonn wwaass rreeccooggnniisseedd aatt 3300 JJuunnee 22002233 ((22002222:: $$116622..55 mmiilllliioonn)).. TThhee iimmppaaiirrmmeenntt wwaass ffiirrsstt
ttaakkeenn aaggaaiinnsstt ggooooddwwiillll (($$11,,115500..99 mmiilllliioonn)) aanndd tthheenn aappppoorrttiioonneedd bbeettwweeeenn pprrooppeerrttyy,, ppllaanntt aanndd eeqquuiippmmeenntt (($$881177..99 mmiilllliioonn)),,
iinnttaannggiibblleess (($$118844..33 mmiilllliioonn)) aanndd ootthheerr nnoonn--ccuurrrreenntt aasssseettss (($$1144..77 mmiilllliioonn))..
61
61
103
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
KEY ASSUMPTIONS
The fair value measurement is valued using level 3 valuation techniques (refer to note E2(i) for details of the levels). The key
assumptions on which management based its cash flow projections when determining 'fair value less costs of disposal' are
as follows:
ii.. CCaasshh ffllooww ffoorreeccaassttss
The cash flow forecasts for Sydney and Gold Coast are based upon Board approved forecasts for a five-year period, together
with longer term projections, growth rates and approved capital investment plans.
The cash flow forecasts for Brisbane incorporate the Board approved FY24 budget for the remaining year of existing
operations, valuation of the Treasury buildings and DBC related casino management fees and distributions from DBC.
iiii.. TTeerrmmiinnaall vvaalluuee
The terminal growth rate used is in line with the forecast long term underlying growth rate in the Consumer Price Index (CCPPII).
iiiiii.. DDiissccoouunntt rraatteess
Discount rates applied are based on the post tax weighted average cost of capital applicable to the relevant cash generating
unit. The discount rate includes a risk premium for the uncertainty associated with ongoing regulatory and other matters,
including:
Base risk premium (all properties): general risk associated with the achievement of underlying cashflows, including in
relation to the recently implemented regulatory changes and inherent risks in the gaming industry.
Legal and other matters (Sydney and Gold Coast): significant uncertainty remains around the quantum and timing of
penalties and fines in relation to AUSTRAC and the quantum (if any) in relation to the possible outcome of the four class
actions.
NSW casino duties (Sydney): the NSW casino duty has a staged introduction, with FY31 the first year the full duty will be
levied (unless revenue surpasses certain thresholds beforehand). Uncertainty relates to forecast casino duty in the latter
years of implementation.
Operating conditions (Brisbane): conditions that have impacted the Sydney and Gold Coast cash generating unit's during
the year, including the implementation of uplifted controls, which necessarily resulted in increased exclusions; the
important uplifting of risk and compliance resourcing; some operating restrictions impacting customer experience; and
weaker consumer discretionary spending, are considered probable to have an impact on the future performance of The
Star Brisbane.
iivv.. RReegguullaattoorryy cchhaannggeess
RReegguullaattoorryy aanndd lleeggaall ccoossttss
The provisions for regulatory and legal costs have been included in the Sydney and Gold Coast cash flow forecasts. Specific
risk factors have been included reflecting the possibility that payments exceed existing provisions.
NNSSWW CCaassiinnoo DDuuttyy RRaatteess
On 11 August 2023, the NSW Treasurer announced increases to specified duty rates applicable to casinos in NSW, effective
1 July 2023. The new rates are tiered, dependent on gaming revenue thresholds, and represent a rate increase across all
products. Cashflows expected for these changes have been included in the impairment models.
BBrriissbbaannee
Upon opening of the entertainment and leisure destination from April 2024, the existing Brisbane casino will cease to
operate and the Group will act as the operator of the QWB casino.
The Group currently holds a perpetual casino licence in Brisbane that is attached to the lease of the current Brisbane site
that expires in 2070. Upon opening of the QWB casino, the Group's casino licence will be surrendered and Destination
Brisbane Consortium (DDBBCC) will be granted a casino licence for 99 years including an exclusivity period of 25 years. The
Group will surrender the Brisbane casino licence and some operational assets in exchange for the right to operate the new
QWB casino.
62
104
62
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
vv.. IImmppaaiirrmmeenntt
In the Sydney and Gold Coast cash generating units, the implementation of uplifted controls, which necessarily resulted in
increased exclusions; the important uplifting of risk and compliance resourcing; the introduction of competition during the
period in the Sydney table games market; some operating restrictions impacting customer experience; and weaker consumer
discretionary spending have all impacted operating performance. Significant uncertainty remains around the quantum and
timing of penalties and fines in relation to AUSTRAC and the quantum (if any) in relation to the possible outcome of the four
class actions. In Sydney, the new NSW casino duty rates have increased duties payable. In Brisbane, it is considered
probable that the operating and economic conditions affecting Sydney and Gold Coast will also impact on the future earnings
of The Star Brisbane casino.
In combination, these factors have reduced the valuation of the cash generating units, requiring an impairment of $2,167.8
million (Sydney: $1,583.1 million, Gold Coast $450.3 million and Brisbane $134.4 million) to be recognised for the year
ended 30 June 2023 (2022: $162.5 million). The impairment is recognised in the line ‘Depreciation, amortisation and
impairment expense’ in the Consolidated Income Statement. The impairment was first allocated against the cash generating
unit’s goodwill balance ($1,150.9 million) and then apportioned between property, plant and equipment ($817.9 million),
intangibles ($184.3 million) and other non-current assets ($14.7 million).
vvii.. SSeennssiittiivviittiieess
The key estimates and assumptions used to determine the 'fair value less costs of disposal' of a cash generating unit are
based on management's current expectations after considering past experience, future investment plans and external
information. They are considered to be reasonably achievable, however, changes in any of these key estimates, assumptions
or regulatory environments may require further impairment charges to be recognised.
An increase or decrease of 0.5% in the discount rate would result in changes to the impairment of each cash generating unit:
Sydney, +$56.9 million or -$64.3 million; Gold Coast, +$38.2 million or -$43.4 million; and Brisbane, +$78.4 million or
-$86.7 million.
IMPAIRMENT OF ASSETS
Goodwill and indefinite life intangible assets are tested for impairment at least annually. Property, plant and equipment,
other intangible assets and other non-financial assets are considered for impairment if there is a reason to believe that
impairment may be necessary. Factors taken into consideration in reaching such a decision include the economic viability of
the asset itself and where it is a component of a larger economic entity, the viability of the unit itself.
63
63
105
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
LIABILITIES
B7 PROVISIONS, CONTINGENT LIABILITIES AND REGULATORY MATTERS
Current
Regulatory and legal provisionsa
Employee benefits
Worker's compensation
Non current
Employee benefits
Other
2023
$m
423.1
76.2
6.4
505.7
6.6
1.4
8.0
2022
$m
12.7
96.1
6.4
115.2
6.9
1.4
8.3
a The Group recognised provisions relating to various regulatory and legal matters including fines issued by the NICC and OLGR, AUSTRAC civil proceedings,
underpaid casino duty in NSW, consultants, Manager, Special Manager, legal and other costs. Disclosing individual amounts would seriously prejudice these
matters considering the present status and range of potential outcomes (2022: provision for underpaid casino duty in NSW).
Reconciliations of each class of provision, except for employee benefits, at the end of each financial year are set out below:
22002233
Carrying amount at beginning of the year
Provisions made during the year
Provisions utilised during the year
22002222
Carrying amount at beginning of the year
Provisions made during the year
Provisions utilised during the year
RReegguullaattoorryy
aanndd lleeggaall
pprroovviissiioonnss
$$mm
WWoorrkkeerrss''
ccoommppeennssaattiioonn
((ccuurrrreenntt))
$$mm
OOtthheerr ((nnoonn--
ccuurrrreenntt))
$$mm
1122..77
559944..88
((118844..44))
442233..11
--
30.1
((1177..44))
12.7
66..44
33..33
((33..33))
66..44
6.3
2.6
(2.5)
6.4
11..44
--
--
11..44
1.4
-
-
1.4
AAUUSSTTRRAACC cciivviill pprroocceeeeddiinnggss
As announced on 7 June 2021, and 14 January 2022, entities within the Group were the subject of an AUSTRAC
enforcement investigation. This followed potential non-compliance concerns identified in the course of a compliance
assessment which was commenced by AUSTRAC in September 2019.
On 30 November 2022 The Star Pty Limited and The Star Entertainment QLD Limited (collectively TThhee SSttaarr EEnnttiittiieess), were
served with a statement of claim from AUSTRAC, commencing Federal Court civil penalty proceedings in relation to alleged
contraventions of obligations under the Anti-Money Laundering and Counter Terrorism Financing (AML/ CTF) Act 2006. The
claims include that The Star Entities:
1. Failed to appropriately assess the money laundering and terrorism financing risks.
2. Did not include in their AML/CTF programs appropriate risk-based systems and controls to mitigate and manage risks.
3. Failed to establish an appropriate framework for Board and senior management oversight of the AML/CTF programs.
4. Did not have a transaction monitoring program to monitor transactions and identify suspicious activity that was
appropriately risk-based or appropriate to the nature, size and complexity of The Star Entities.
64
106
64
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
5. Did not have an appropriate enhanced customer due diligence program to carry out additional checks on higher risk
customers.
6. Did not conduct appropriate ongoing customer due diligence on a range of customers who presented higher money
laundering risks 1,189 times in New South Wales and 325 times in Queensland.
The parties are working towards the preparation of a Statement of Agreed Facts and Admissions (SSAAFFAA). At the case
management hearing on 14 July 2023, the Court ordered that the final SAFA be filed by 1 November 2023.
AUSTRAC has commenced civil penalty proceedings against other companies on five occasions, one of which is yet to
conclude. The four concluded AUSTRAC proceedings to date have led to the Federal Court approving and / or ordering the
respondent to pay significant penalties (Tabcorp $45 million (2017); CBA $700 million (2018); Westpac $1.3 billion (2020)
and most recently, Crown $450 million (2023)). The determination of the Federal Court’s penalty (including where a penalty
has been jointly proposed by AUSTRAC and the defendant to the Court) is specific to the facts of each case and arrived at
after consideration of the SAFA and evidence and submissions in relation to the appropriateness of the penalty.
The Statement of Claim from AUSTRAC alleges that the number of breaches committed by The Star Entities is innumerable.
Following a review of the Statement of Claim, and an analysis of the penalties against other companies (described above),
the relative size of the Group and capacity to pay, the Group has determined an appropriate provision on the balance sheet
as at 30 June 2023. This provision was and is recognised at a time where there remains considerable uncertainty on the
approach the Federal Court will ultimately take when approving any agreed penalty and where The Star Entities continue to
engage with AUSTRAC and the Australian Government Solicitor in relation to remediation activities designed to address
allegations of ongoing deficiencies in The Star Entities' AML/Program. Any actual penalty paid by the Group may differ
materially to the provision recorded at 30 June 2023.
UUnnddeerrppaaiidd ccaassiinnoo dduuttyy
During the Bell review, concerns were raised regarding the characterisation of residency for rebate patrons and the potential
consequences for the Group’s calculations of rebate duty payable to the NSW Government. As a result, the Group undertook
an independent assessment of residency status and consequential rebate gaming activity for a number of patrons that had
changed their residency status from ordinarily resident in New South Wales to being ordinarily resident interstate or overseas
between 28 November 2016 to May 2022.
The Bell report recommended the NSW Independent Casino Commission (NNIICCCC) engage an independent expert to perform
their own audit of all patrons that engaged in rebate play at The Star Sydney since 28 November 2016 and a clear and
objective test regarding the residency of players be included in The Star Sydney’s Duty Agreement.
The Group is working with NSW Liquor and Gaming to agree the scope of an independent review applicable to rebate play for
all patrons. The Group has also commenced working with the NICC and Treasury to develop a clear and objective test for the
residency of players. Such a test will require an amendment to The Star Sydney’s Duty agreement and result in changes to
relevant internal controls.
The Group has determined an appropriate provision on the balance sheet at 30 June 2023 of the potential impact of the
review of rebate play for all patrons. The final quantum of casino duty may be materially different to the amount provided as
it is subject to further analysis and discussions with the NICC and NSW Treasury.
AASSIICC cciivviill ppeennaallttyy pprroocceeeeddiinnggss aaggaaiinnsstt ffoorrmmeerr ddiirreeccttoorrss aanndd ooffffiicceerrss ooff tthhee CCoommppaannyy
In December 2022, the Australian Securities and Investment Commission (AASSIICC) commenced civil penalty proceedings in the
Federal Court of Australia against 11 former directors and officers of the Company alleging contraventions of their duties
under s180(1) of the Corporations Act 2001 (Cth). The alleged contraventions arise from certain matters considered in the
Bell and Gotterson Reviews.
As no entity of the Group is party to these proceedings, it is not possible to predict the timing and any financial impact of
these claims on the Group (including in terms of the Group bearing costs for the defendants, or the extent to which those
costs might be covered by available insurances and indemnities in place for previous officers and directors).
The Group has provided for an estimate of legal costs as at 30 June 2023.
65
65
107
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
CCllaassss aaccttiioonnss
On 30 March 2022, 7 November 2022 and 3 and 6 February 2023, the Company was served by Slater & Gordon, Maurice
Blackburn, Phi Finney McDonald and Shine Lawyers respectively with separate statements of claim for securities class
actions in the Supreme Court of Victoria.
The claims are substantially similar and allege the Group failed to comply with continuous disclosure requirements and
engaged in misleading or deceptive conduct between 2016 and 2022 through various alleged disclosures or non-disclosures
about its systems, controls, operations and regulatory risks. The allegations reference the Bell review and previous media
reporting.
On 27 and 28 June 2023, the Court heard carriage and costs order applications from each of the four plaintiff law firms.
Judgment has been reserved in relation to which plaintiff firm will have carriage of the proceedings and the terms of any
relevant group costs order.
The Company intends to defend the proceedings.
The outcome and any potential financial impacts are unknown, including the extent to which any costs might be covered by
the Group’s insurance policies.
GGSSTT aammeennddeedd aasssseessssmmeennttss
On 11 August 2021 the Group received amended assessments from the Australian Taxation Office (AATTOO) in respect of a
dispute for the period October 2013 to August 2017 (inclusive) in relation to the GST treatment of rebates paid to junket
operators for The Star Pty Limited. The amount in dispute for this period is approximately $143.8 million (primary tax of
$81.9 million and interest of $61.9 million). In FY22 the Group paid $40.9 million as a deposit to the ATO on a no-admissions
basis. The deposit is held as a current asset on the balance sheet.
On 6 September 2021 the Group filed an application for judicial review with the Federal Court in relation to the interest
assessment and on 5 October 2021 lodged an objection against the primary assessments with the ATO. The matter has been
adjourned until the outcome of the objections, which is yet to be decided. The Group considers that it has paid the correct
amount of tax and will pursue all available avenues of objection.
WWiitthhhhoollddiinngg ttaaxx ppeennaallttyy
The ATO has issued a penalty for $6.4 million in relation to a dispute over the appropriate method for calculating withholding
tax on Junket rebates for the 2015 to 2020 income tax years. The Group has objected to the ATO’s decision to issue the
penalty, consequently the ATO is conducting an internal review of this matter. The objection is yet to be decided.
The Group considers that it has paid the correct amount of tax and will pursue all available avenues of objection.
LLeeggaall cchhaalllleennggeess
There are outstanding legal actions between the Company and its controlled entities and third parties as at 30 June 2023.
The Group has notified its insurance carrier of all relevant litigation and believes that any damages (other than exemplary
damages) that may be awarded against the Group, in addition to its costs incurred in connection with the action, will be
covered by its insurance policies where such policies are in place. Provisions are made for known obligations where the
existence of a liability is probable and can be reasonably estimated. As the outcomes of these actions remain uncertain,
contingent liabilities exist for possible amounts eventually payable.
The Group has no other contingent liabilities other than those disclosed in these financial statements.
NNEEWW SSOOUUTTHH WWAALLEESS
RReegguullaattoorryy rreeffoorrmmss
On 11 August 2022 the Casino Legislation Amendment Act 2022 (NSW) was enacted to give effect to amendments to the
Casino Control Act 1992 (NSW). These amendments enacted reforms to the NSW casino regulatory framework, including to
address the recommendations of the Bergin Inquiry and certain additional measures and to establish the NICC as a new
independent regulator. The reforms also purported to override compensation rights previously available to the Group for
specified regulatory changes. The amendments were effective from 5 September 2022 with the exception of compulsory
carded play and cash play limits, which commence on 11 August 2024 (unless an earlier date is set by Government). The
amendments include expanding the definition of gaming revenue to include slots free play.
BBeellll rreeppoorrtt
The Bell Report was provided to the Independent Liquor and Gaming Authority (ILGA) on 31 August 2022 and published by
the NICC on 13 September 2022. Mr Bell made a total of 30 recommendations and found The Star unsuitable to hold a
casino licence in NSW.
66
108
66
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
DDiisscciipplliinnaarryy aaccttiioonn
After considering the Bell Report recommendations and The Star’s response to the show cause notice issued on 13
September 2022, the NICC issued a $100 million fine (payable in 3 instalments on 31 March 2023, 30 June 2023 and 29
December 2023), suspended The Star’s casino licence and appointed a Manager for the Sydney casino. The Manager was
appointed initially for 90 days, however on 16 December 2022 this was extended to 19 January 2024.
The final instalment for the pecuniary penalty has been recorded as a liability on the balance sheet at 30 June 2023.
The Star Sydney remains open and operating, and net earnings continue to be paid to The Star after payment of the
Manager’s costs. The Manager has assumed the responsibility and control of The Star’s casino operations.
CCaassiinnoo dduuttyy rreeffoorrmmss
On 11 August 2023 the NSW Treasurer and the Group announced an in-principle agreement had been reached in relation to
changes to casino duty rates for casinos in New South Wales and their impact on The Star Sydney. The in-principle
agreement supersedes the proposal announced by the previous Liberal NSW Treasurer on 17 December 2022. Once
formalised the amendments announced are designed to deliver a sustainable outcome for The Star Sydney and to protect
the jobs of thousands of NSW team members.
The changes include rate increases for rebate duty (10% to 12.5%) and Table Games (17.91% to 20.25%) from 1 July 2023.
Poker Machine duty rates will remain unchanged until 2030 (currently 20.91%, 21.91% from 1 July 2024 and 22.91% from
1 July 2027). From 1 July 2030 poker machines will be taxed based on average poker machine revenue using a progressive
rate scale with a maximum of 51.6%. In the period 1 July 2023 to 30 June 2030 an additional levy will apply equal to 35% of
The Star Sydney’s gaming revenue above $1.125 billion per financial year. There is no change to the Responsible Gambling
Levy rate.
Further, the in-principle agreement includes a jobs agreement that provides employment certainty for team members in
arrangements agreed with the United Workers Union. The Star Sydney will also introduce a trial of its cashless gaming
machine technology in October 2023 on 50 gaming machines and 8 gaming tables.
QQUUEEEENNSSLLAANNDD
RReegguullaattoorryy rreeffoorrmmss
On 14 October 2022 the Casino Control and Other Legislation Amendment Bill 2022 (Qld) was passed by the Queensland
Parliament. The legislative amendments to the Casino Control Act 1982 (Qld) included increasing the maximum pecuniary
penalty to $100 million, allowing for the appointment of a Special Manager and overriding compensation rights previously
available to the Group for specified regulatory changes.
GGootttteerrssoonn RReeppoorrtt
In July 2022 an independent review commenced of the Group’s Queensland casinos, The Star Gold Coast and Treasury
Brisbane.
The Attorney-General appointed The Honourable Robert Gotterson AO to examine whether these casinos operate in a way
that is consistent with achieving the objectives of the Casino Control Act 1982 (Qld) and the ongoing suitability of the Group’s
casino licensees. The Gotterson Report was publicly released on 6 October 2022, making 12 recommendations, which have
been accepted in-principle by the Queensland Government. On 25 October 2022 the Attorney-General formally determined
that the Group’s Queensland casino licensees, and other associated entities of The Star Entertainment Group, were not
suitable to be associated or connected with the management and operations of a hotel-casino complex or casino in
Queensland, by reason of it not being a person of good repute.
Further amendments to the Casino Control Act 1982 (Qld) are expected in 2023 to enact the remaining recommendations
from the Gotterson Report, including mandatory carded play and cash limits and mandatory player pre-commitments.
DDiisscciipplliinnaarryy aaccttiioonn
On 9 December 2022 the Attorney-General announced a total penalty of $100 million in relation to the Group’s Queensland
casinos (payable in three instalments on 31 March 2023, 30 June 2023 and 31 December 2023); suspended the Group’s
Queensland casino licences for a period of 90 days on a deferred basis with effect from 1 December 2023 unless postponed
or rescinded due to satisfactory progress towards suitability, and appointed a Special Manager to monitor the operations of
the Group’s Queensland casinos.
The final instalment for the pecuniary penalty has been recorded as a liability on the balance sheet at 30 June 2023.
FFiinnaanncciiaall gguuaarraanntteeeess
Refer to note E1 for details of financial guarantees provided by the Group at the reporting date.
67
67
109
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
B8 INTEREST BEARING LIABILITIES
CCuurrrreenntt
Lease liabilities
NNoonn ccuurrrreenntt
Bank loans - unsecured (net of unamortised borrowing costs)
Private placement - US dollar - amortised cost
Lease liabilities
22002233
$$mm
66..00
66..00
336622..99
335577..55
3300..88
775511..22
22002222
$$mm
6.1
6.1
705.7
583.9
36.8
1,326.4
The bank facilities have maturities between eight months and three years, with an average weighted maturity of 2.0 years
(2022: 2.9 years).
During the year, the interest bearing liabilities were amended to either amend covenant calculations or allow for the capital
raising, resulting in increased interest charges over the balance of the tenure. The bank loans and USPP were modified,
resulting in an increase of $30.0 million, recognised in finance costs. The modification has been amortised through 30 June
2023, with $0.9 million remaining in bank loans and $10.0 million remaining in USPP.
On 24 March 2023, following the capital raising, existing bank loan facility amounts were reduced by $338.0 million
(approximately 30%) while on 31 March 2023, US$172.6 million of USPPs were prepaid (approximately 42.3%). Facility
maturity dates were not affected as part of this reduction.
NNeett ddeebbtt wwaass $$559955..55 mmiilllliioonn,, ddoowwnn 4488..22%% oonn tthhee ppccpp.. AAddjjuusstteedd ggeeaarriinngg lleevveellss,, ccaallccuullaatteedd aass aaggrreeeedd wwiitthh tthhee ffiinnaanncciieerrss
oonn wwaass 11..99xx ((22002222:: 22..88xx aaddjjuusstteedd))..
RReeffeerr ttoo nnoottee FF77 ((iiiiii)) ffoorr CCaappiittaall mmaannaaggeemmeenntt ddiisscclloossuurreess aanndd tthhee ccaallccuullaattiioonn ooff tthhee ggeeaarriinngg rraattiioo..
22002233
TTyyppee
Bank loans
Bank loans
Bank loans
Bank loans
TToottaall bbaannkk llooaannss
USPP
USPP
USPP
TToottaall UUSSPPPP
TToottaall
FFaacciilliittyy aammoouunntt
$$mm UUSSDD
FFaacciilliittyy aammoouunntt
$$mm AAUUDD aa
UUnnuuttiilliisseedd aatt 3300 JJuunnee
$$mm
-
-
-
-
--
28.9
166.5
40.4
223355..88
223355..88
104.0
540.0
120.0
28.0
779922..00
37.0
213.3
54.2
330044..55
104.0
226.0
70.0
28.0
442288..00
-
-
-
--
11,,009966..55
442288..00
MMaattuurriittyy ddaattee
March 2024
July 2024
July 2025
July 2026
August 2025
August 2027
September 2028
68
110
68
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
22002222
TTyyppee
Bank loans
Bank loans
Bank loans
Bank loans
Bank loans
Total bank loans
USPP
USPP
USPP
Total USPP
Total
FFaacciilliittyy aammoouunntt
FFaacciilliittyy aammoouunntt
UUnnuuttiilliisseedd aatt 3300 JJuunnee
$$mm UUSSDD
$$mm AAUUDD aa
$$mm
MMaattuurriittyy ddaattee
-
-
-
-
-
-
50.0
288.4
70.0
408.4
408.4
75.0
150.0
765.0
175.0
40.0
1,205.0
64.0
369.4
93.9
527.3
1,732.3
July 2022
July 2023
July 2024
July 2025
July 2026
August 2025
August 2027
September 2028
75.0
56.0
225.0
100.0
40.0
496.0
-
-
-
-
496.0
a USPP Notes are issued in USD and presented at the AUD amount repayable under cross currency interest rate swaps at
maturity.
BANK LOANS - UNSECURED (NET OF UNAMORTISED BORROWING COSTS) & US PRIVATE PLACEMENT (USPP)
BBaannkk llooaannss aanndd wwoorrkkiinngg ccaappiittaall ffaacciilliittyy
Interest on bank facilities is variable, linked to Bank Bill Swap Bid Rate, plus a margin.
The Group has entered into interest rate swap agreements to hedge underlying debt obligations and allow $100 million
(2022: $250 million) of floating rate bank loans to be swapped to fixed rate borrowings. Further details about the Group's
exposure to interest rate movements are provided in notes E1 and E2.
USPP
The $357.5 million (2022: $583.9 million) USPP comprises the US$235.8 million (2022: US$408.4 million) USPP converted
to $353.7 million AUD at 30 June rates (2022: $591.6 million AUD) and, the fair value movement of future interest payments
subject to fair value hedges, being an asset of $5.3 million (2022: $7.7 million) and $10.0 million of debt modification
(2022: nil), partially offset by $0.9 million of unamortised borrowing costs (2022: nil). Interest is a combination of fixed and
variable, linked to Bank Bill Swap Rate, and a defined gearing ratio at the end of certain test dates.
FAIR VALUE DISCLOSURES
Details of the fair value of the Group's interest bearing liabilities are set out in note E2.
FINANCIAL RISK MANAGEMENT
As a result of the USPP borrowings, the Group is exposed to foreign currency risk through the movements in USD/AUD
exchange rate. The Group has entered into cross currency swaps in order to hedge this exposure. As at 30 June 2023,
repayment of the US$235.8 million (2022: US$408.4 million) is 100% hedged (2022: 100%). The base USD coupon
continues to be 100% hedged (2022: 100% hedged), however amendments to the USPP during the year gave rise to
incremental USD denominated coupon payments, which are not hedged.
The Group is also exposed to the interest rate risk as a result of bank loans and the USPP borrowings. To hedge against this
risk, the Group has entered into interest rate swaps. As at 30 June 2023, after taking into account the effect of interest rate
swaps, approximately 50.5% (2022: 46.0%) of the Group's borrowings are hedged at a fixed rate of interest. Further details
about the Group's exposure to interest rate and foreign currency movements are provided in notes E1 and E2.
69
69
111
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
C
COMMITMENTS AND SUBSEQUENT EVENTS
C1 COMMITMENTS
OTHER COMMITMENTS a
Not later than one year
Later than one year but not later than five years
Later than five years
22002233
$$mm
1133..66
--
--
1133..66
22002222
$$mm
44.6
0.3
-
44.9
a
Other commitments as at 30 June 2023 have decreased due to suspension of non-critical business projects at the Sydney property.
Total project costs for Destination Brisbane Consortium's (DDBBCC) development of the entertainment and leisure destination
are expected to be $2.9 billion. The majority of these cost over-runs are to be funded via additional equity contributions in
proportion with the existing joint venture interests. The Group's expected contribution is approximately $100 million.
Remaining construction costs are to be funded out of committed project financing.
For Destination Gold Coast Consortium (DDGGCCCC), construction is underway on Tower 2 at 30 June 2023. Equity contributions
towards Tower 1 are complete. DGCC is seeking project level debt facilities for the remainder of the Tower 2 construction
costs. Until such a facility is secured, committed spend is to be funded by joint venturer loans or equity contributions.
Refer to note D5 for commitments in respect of investment in associate and joint venture entities.
C2 SUBSEQUENT EVENTS
CCaassiinnoo dduuttyy rreeffoorrmmss
On 11 August 2023 the NSW Treasurer and the Group announced an in-principle agreement had been reached in relation to
changes to casino duty rates for casinos in New South Wales and their impact on The Star Sydney. The in-principle
agreement supersedes the proposal announced by the previous Liberal NSW Treasurer on 17 December 2022. Once
formalised the amendments announced are designed to deliver a sustainable outcome for The Star Sydney and to protect
the jobs of thousands of NSW team members.
The changes include rate increases for rebate duty (10% to 12.5%) and Table Games (17.91% to 20.25%) from 1 July 2023.
Poker Machine duty rates will remain unchanged until 2030 (currently 20.91%, 21.91% from 1 July 2024 and 22.91% from
1 July 2027). From 1 July 2030 poker machines will be taxed based on average poker machine revenue using a progressive
rate scale with a maximum of 51.6%. In the period 1 July 2023 to 30 June 2030 an additional levy will apply equal to 35% of
The Star Sydney’s gaming revenue above $1.125 billion per financial year. There is no change to the Responsible Gambling
Levy rate.
Further, the in-principle agreement includes a jobs agreement that provides employment certainty for team members in
arrangements agreed with the United Workers Union. The Star Sydney will also introduce a trial of its cashless gaming
machine technology in October 2023 on 50 gaming machines and 8 gaming tables.
70
112
70
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
DDBBCC ddiissppuuttee wwiitthh MMuullttiipplleexx
The Group has partnered with Hong Kong-based organisations Chow Tai Fook Enterprises Limited and Far East Consortium
International Limited to form Destination Brisbane Consortium (DDBBCC) for the Queen's Wharf Brisbane Project.
Multiplex (MMPPXX) is the principal contractor on the Queen’s Wharf Brisbane Integrated Resort Development project. Since early
2022 MPX has submitted a number of claims to DBC seeking damages and extensions of time and makes various
allegations against DBC and the principal’s representative. DBC claims that it is entitled to liquidated damages from MPX due
to its failure to meet contractual completion dates and commenced deducting liquidated damages from MPX in July 2023.
On 18 May 2023, MPX issued a Formal Dispute notice to DBC. MPX also included in its July 2023 progress claim, significant
claims for delay costs and acceleration costs and for repayment of liquidated damages deducted. These claims have been
reviewed and rejected by the Principal’s Representative during the course of the contract. DBC delivered a detailed Payment
Schedule on 8 August 2023 rejecting these claims in total and deducting further liquidated damages from the monthly
amount that would have been payable to Multiplex. On 18 August 2023 DBC was served with a Statement of Claim filed by
MPX in the Supreme Court of Queensland. The claim seeks various declarations from the Court regarding extensions of time,
relevant milestone dates, liquidated damages, variations and certain other matters, including potential sums payable, in
connection with the contract and seeks various orders in relation to those matters. The Group understands that DBC intends
to defend the proceedings.
On 28 August 2023, DBC was issued with an adjudication application lodged by MPX with the Queensland Building and
Construction Commission under the Building Industry Fairness (Security of Payment) Act 2017 (Qld). The application is
seeking awards by the adjudicator for extensions of time, certification of stage completion, entitlements to liquidated
damages and payment of certain amounts (comprising delay costs, set-offs, acceleration costs, variations and other
amounts). The adjudication claim is separate to the Supreme Court proceedings. The Group understands that DBC is
currently reviewing the adjudication application and that it intends to respond in accordance with the process in the relevant
legislation.
Other than those events disclosed in the Directors' Report or elsewhere in these financial statements, there have been no
other significant events occurring after the balance sheet date and up to the date of this report, which may materially affect
either the Group's operations or results of those operations or the Group's state of affairs.
71
71
113
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
D
GROUP STRUCTURES
D1 RELATED PARTY DISCLOSURES
(i) PARENT ENTITY
The ultimate parent entity within the Group is The Star Entertainment Group Limited.
(ii) INVESTMENTS IN CONTROLLED ENTITIES
The consolidated financial statements incorporate the assets, liabilities and results of the following controlled entities in
accordance with the accounting policy described in note G. The financial years of all controlled entities are the same as that
of the Company (unless stated otherwise below).
Name of controlled entity
PPaarreenntt eennttiittyy
The Star Entertainment Group Limited
CCoonnttrroolllleedd eennttiittiieess
The Star Entertainment Sydney Holdings Limited
The Star Pty Limited
The Star Entertainment Pty Ltd
The Star Entertainment Sydney Properties Pty Ltd
The Star Entertainment Sydney Apartments Pty Ltd
Star City Investments Pty Limited
Star City Share Plan Company Pty Ltd
The Star Entertainment QLD Limited
The Star Entertainment QLD Custodian Pty Ltd
The Star Entertainment Gold Coast Trust
The Star Entertainment International No.1 Pty Ltd
The Star Entertainment International No.2 Pty Ltd
The Star Entertainment (Macau) Limited
The Star Entertainment International No.3 Pty Ltd
EEI Services (Hong Kong) Holdings Limited
EEI Services (Hong Kong) Limited
EEI C&C Services Pte Ltd
The Star Entertainment RTO Pty Ltd
The Star Entertainment Finance Limited
Destination Cairns Consortium Pty Limited
The Star Entertainment Technology Services Pty Ltd
The Star Entertainment Training Company Pty Ltd
The Star Entertainment Letting Pty Ltd
The Star Entertainment Online Holdings Pty Ltd
The Star Entertainment Online Pty Ltd
The Star Entertainment Brisbane Holdings Pty Ltd
The Star Entertainment Brisbane Operations Pty Ltd
The Star Entertainment DBC Holdings Pty Ltd
The Star Brisbane Car Park Holdings Pty Ltd
The Star Entertainment Gold Coast Holdings Pty Ltd
The Star Entertainment GC Investments Pty Ltd
The Star Entertainment GC Investments No.1 Pty Ltd
The Star Entertainment International No.5 Pty Ltd
EEI Services Holdings No.1 Pty Ltd
EEI Services Holdings No.2 Pty Ltd
72
114
NNoottee
Country of
incorporation Equity type
Australia
ordinary shares
EEqquuiittyy
iinntteerreesstt aatt
3300 JJuunnee
22002233
%%
EEqquuiittyy
iinntteerreesstt aatt
3300 JJuunnee
22002222
%%
a b
a b
a
a b
a
a
c
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Macau
Australia
Hong Kong
Hong Kong
Singapore
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
units
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
72
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
Name of controlled entity
EEI Services (Macau) Limited
The Star Entertainment International Tourism Pty Ltd
Destination Sydney Consortium Pty Limited
The Star Entertainment Pyrmont Investments No.1 Pty Ltd
The Star Entertainment GC No.1 Pty Ltd
The Star Entertainment GC No.2 Pty Ltd
The Star Entertainment Group Limited Employee Share Trust
NNoottee
Country of
incorporation Equity type
Macau
Australia
Australia
Australia
Australia
Australia
Australia
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
ordinary shares
units
EEqquuiittyy
iinntteerreesstt aatt
3300 JJuunnee
22002233
%%
EEqquuiittyy
iinntteerreesstt aatt
3300 JJuunnee
22002222
%%
110000..00
110000..00
110000..00
110000..00
110000..00
110000..00
00..00
100.0
100.0
100.0
100.0
100.0
100.0
0.0
a
b
c
These companies entered into a deed of cross guarantee with The Star Entertainment Sydney Holdings Limited on 31 May 2011, and as
such are members of the closed group as defined in Australian Securities and Investments Commission Instrument 2016/785 (refer to
note D3).
These companies have provided a charge over their assets and undertakings as explained in note E1.
This company's financial year end is 31 December.
(iii) TRANSACTIONS WITH CONTROLLED ENTITIES
TThhee SSttaarr EEnntteerrttaaiinnmmeenntt GGrroouupp LLiimmiitteedd
During the period, the Company entered into the following transactions with controlled entities:
loans of $344.7 million were advanced by controlled entities (2022: were repaid by controlled entities $49.5 million);
and
income tax and GST paid on behalf of controlled entities was $144.9 million (2022: $133.7 million).
The amount receivable by the Company from controlled entities at year end is $1,052.2 million (2022: $707.5 million). All
the transactions were undertaken on normal commercial terms and conditions.
(iv) TRANSACTIONS WITH OTHER RELATED PARTIES
OOtthheerr ttrraannssaaccttiioonnss
During the period, in addition to equity contributions (refer to note D5), the Group entered into the following transactions with
related parties:
Amount recharged to Destination Brisbane Consortium was $13.1 million (2022: nil) in relation to pre-opening costs and
reimbursement for asset purchases. There was no outstanding amount at 30 June 2023;
Amount recharged to Destination Gold Coast Consortium Pty Ltd was $10.8 million (2022: $14.3 million) in relation to
labour supply and building management services provided to the Dorsett Hotel. There was no outstanding balance at 30
June 2023 (2022: nil); and
Amount paid to Destination Gold Coast Consortium Pty Ltd was $15.9 million (2022: $10.7 million) relating to
development of Towers 1 and 2.
73
73
115
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
D2 PARENT ENTITY DISCLOSURES
The Star Entertainment Group Limited, the parent entity of the Group, was incorporated on 2 March 2011.
RReessuulltt ooff tthhee ppaarreenntt eennttiittyy
Loss for the year a
TToottaall ccoommpprreehheennssiivvee lloossss ffoorr tthhee yyeeaarr b
22002233
$$mm
(2,304.5)
(2,304.5)
22002222
$$mm
(0.2)
(0.2)
a
b
The investments into Sydney and Queensland were impaired $1,777.9 million (2022: nil) as a result of the decrease in valuation of the
respective cash generating units (refer to note B6).
No final dividend was declared, in accordance with the conditions of debt covenant waivers which restrict further cash dividends from
being paid until the Group’s gearing, which represents the ratio of net debt to 12 month trailing statutory EBITDA, is below 2.5 times,
the Group returns to suitability and all of the Group's casino licences are in full force and effect (refer to note A6).
FFiinnaanncciiaall ppoossiittiioonn ooff tthhee ppaarreenntt eennttiittyy
Current assets
Non current assets
TToottaall aasssseettss
Current liabilities
Non current liabilities
TToottaall lliiaabbiilliittiieess
NNeett aasssseettss
TToottaall eeqquuiittyy ooff tthhee ppaarreenntt eennttiittyy
Issued capital
Retained earnings
Loss reserve FY23
Shared based payments benefits reserve
TToottaall eeqquuiittyy
22,,117788..22
772211..55
22,,889999..77
7744..77
11,,005544..00
11,,112288..77
11,,777711..00
33,,995566..44
111100..66
((22,,330044..55))
88..55
11,,777711..00
1,783.0
2,593.5
4,376.5
45.6
1,032.2
1,077.8
3,298.7
3,177.8
110.6
-
10.3
3,298.7
CONTINGENT LIABILITIES
CCllaassss AAccttiioonn
On 30 March 2022, 7 November 2022 and 3 and 6 February 2023, the Company was served by Slater & Gordon, Maurice
Blackburn, Phi Finney McDonald and Shine Lawyers respectively with separate statements of claim for securities class
actions in the Supreme Court of Victoria.
The claims are substantially similar and allege the Group failed to comply with continuous disclosure requirements and
engaged in misleading or deceptive conduct between 2016 and 2022 through various alleged disclosures or nondisclosures
about its systems, controls, operations and regulatory risks. The allegations reference the Bell review and previous media
reporting.
On 27 and 28 June 2023, the Court heard carriage and costs order applications from each of the four plaintiff law firms.
Judgment has been reserved in relation to which plaintiff firm will have carriage of the proceedings and the terms of any
relevant group costs order.
The Company intends to defend the proceedings.
The outcome and any potential financial impacts are unknown, including the extent to which any costs might be covered by
the Group’s insurance policies.
74
116
74
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
GGSSTT AAmmeennddeedd AAsssseessssmmeennttss
On 11 August 2021 the Group received amended assessments from the Australian Taxation Office (AATTOO) in respect of a
dispute for the period October 2013 to August 2017 (inclusive) in relation to the GST treatment of rebates paid to junket
operators for The Star Pty Limited. The amount in dispute for this period is approximately $143.8 million (primary tax of
$81.9 million and interest of $61.9 million). In FY22 the Group paid $40.9 million as a deposit to the ATO on a no-admissions
basis. The deposit is held as a current asset on the balance sheet.
On 6 September 2021 the Group filed an application for judicial review with the Federal Court in relation to the interest
assessment and on 5 October 2021 lodged an objection against the primary assessments with the ATO. The matter has been
adjourned until the outcome of the objections, which is yet to be decided.
The Group considers that it has paid the correct amount of tax and will pursue all available avenues of objection.
The Parent has no other contingent liabilities at 30 June 2023.
CAPITAL EXPENDITURE
The parent entity does not have any capital expenditure commitments for the acquisition of property, plant and equipment
contracted but not provided for at 30 June 2023 (2022: nil).
GUARANTEES
The Star Entertainment Group Limited has guaranteed the liabilities of The Star Entertainment Finance Limited, The Star
Entertainment International No.3 Pty Ltd and the customer loans for EEI Services (Hong Kong) Limited1. As at 30 June 2023,
the carrying amount included in current liabilities at 30 June 2023 of $12.0 million (2022: $12.0 million), and the maximum
amount of these guarantees was $58.8 million (2022: $68.1 million) (refer to note E1). The Company has also undertaken to
support its controlled entities when necessary to enable them to pay their debts as and when they fall due.
1 The EEI Services (Hong Kong) Limited office has been closed. The guarantee amount will remain until the process for
dealing with outstanding customer loans has completed.
ACCOUNTING POLICY FOR INVESTMENTS IN CONTROLLED ENTITIES
All investments are initially recognised at cost, being the fair value of the consideration given. Subsequently, investments are
carried at cost less any impairment losses.
75
75
117
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
D3 DEED OF CROSS GUARANTEE
The Star Entertainment Sydney Holdings Limited, The Star Pty Limited, The Star Entertainment Pty Ltd, The Star
Entertainment Sydney Properties Pty Ltd, The Star Entertainment Sydney Apartments Pty Ltd and Star City Investments Pty
Limited are parties to a deed of cross guarantee under which each company guarantees the debts of the others. By entering
into the deed, the wholly-owned entities have been relieved from the requirements to prepare a Financial Report and
Directors Report under Instrument 2016/785 issued by the Australian Securities and Investments Commission.
CCoonnssoolliiddaatteedd iinnccoommee ssttaatteemmeenntt aanndd ssuummmmaarryy ooff mmoovveemmeennttss iinn ccoonnssoolliiddaatteedd eeaarrnniinnggss
The above companies represent a 'closed group' for the purposes of the Class Order, and as there are no other parties to the
deed of cross guarantee that are controlled by The Star Entertainment Sydney Holdings Limited, they also represent the
'extended closed group'.
Set out below is a consolidated income statement and a summary of movements in consolidated retained earnings for the
year ended 30 June 2023 of the closed group.
CCoonnssoolliiddaatteedd iinnccoommee ssttaatteemmeenntt
Revenue
Other income
Government taxes and levies
Employment costs
Depreciation, amortisation and impairment
Cost of sales
Property costs
Advertising and promotions
Regulatory and legal costs
Other expenses
LLoossss bbeeffoorree iinntteerreesstt aanndd ttaaxx ((LLBBIITT))
Net finance costs
LLoossss bbeeffoorree iinnccoommee ttaaxx ((LLBBTT))
Income tax benefit
NNeett lloossss aafftteerr ttaaxx ((NNLLAATT))
TToottaall ccoommpprreehheennssiivvee lloossss ffoorr tthhee ppeerriioodd
SSuummmmaarryy ooff mmoovveemmeennttss iinn ccoonnssoolliiddaatteedd rreettaaiinneedd eeaarrnniinnggss
Accumulated profit at the beginning of the financial year
Loss for the year
22002233
$$mm
998822..66
00..11
((227711..33))
((229922..00))
((777722..22))
((4422..33))
((4400..44))
((3344..00))
((337733..44))
((6666..55))
((990099..44))
((00..33))
((990099..77))
112277..11
((778822..66))
((778822..66))
4499..11
((778822..66))
22002222
$$mm
775.8
0.2
(219.2)
(223.9)
(91.2)
(33.4)
(32.0)
(30.3)
-
(228.3)
(82.3)
(5.1)
(87.4)
25.1
(62.3)
(62.3)
111.4
(62.3)
AAccccuummuullaatteedd pprrooffiitt aatt tthhee eenndd ooff tthhee ffiinnaanncciiaall yyeeaarr
CCoonnssoolliiddaatteedd bbaallaannccee sshheeeett
Set out below is a consolidated balance sheet as at 30 June 2023 of the closed group consisting of The Star Entertainment
Sydney Holdings Limited, The Star Pty Limited, The Star Entertainment Pty Ltd, The Star Entertainment Sydney Properties Pty
Limited, The Star Entertainment Sydney Apartments Pty Limited, and Star City Investments Pty Limited.
((773333..55))
49.1
76
118
76
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
CCoonnssoolliiddaatteedd bbaallaannccee sshheeeett
AASSSSEETTSS
Cash assets
Trade and other receivables
Inventories
Other
TToottaall ccuurrrreenntt aasssseettss
Property, plant and equipment
Intangible assets
Other assets
Deferred tax asset
TToottaall nnoonn ccuurrrreenntt aasssseettss
TTOOTTAALL AASSSSEETTSS
LLIIAABBIILLIITTIIEESS
Trade and other payables
Interest bearing liabilities
Provisions
Other liabilities
TToottaall ccuurrrreenntt lliiaabbiilliittiieess
Deferred tax liabilities
Interest bearing liabilities
Provisions
Other liabilities
TToottaall nnoonn ccuurrrreenntt lliiaabbiilliittiieess
TTOOTTAALL LLIIAABBIILLIITTIIEESS
NNEETT AASSSSEETTSS
EEQQUUIITTYY
Issued Capital
Retained Earnings
TTOOTTAALL EEQQUUIITTYY
D4 KEY MANAGEMENT PERSONNEL DISCLOSURES
Compensation of Key Management Personnel
Short term
Long term
Share based payments
Termination benefits
TToottaall ccoommppeennssaattiioonn
22002233
$$mm
3377..99
1111..99
66..55
1122..00
6688..33
990099..77
111166..22
33..33
111177..33
11,,114466..55
11,,221144..88
448833..44
11..00
330077..88
99..88
880022..00
--
22..11
22..77
11..66
66..44
880088..44
440066..44
11,,113399..99
((773333..55))
440066..44
22002233
$$000000
44,,885533
223399
((6600))
880077
55,,883399
22002222
$$mm
39.5
14.8
7.0
12.4
73.7
1,470.0
262.6
4.2
-
1,736.8
1,810.5
508.6
0.9
52.3
11.5
573.3
42.4
3.0
2.8
-
48.2
621.5
1,189.0
1,139.9
49.1
1,189.0
22002222
$$000000
6,275
285
(2,466)
3,794
7,888
The above reflects the compensation for individuals who are Key Management Personnel of the Group. The note should be
read in conjunction with the Remuneration Report.
77
77
119
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
D5 INVESTMENT IN ASSOCIATE AND JOINT VENTURE ENTITIES
Set out below are the investments of the Group as at 30 June 2023. The entities listed below have share capital consisting
solely of ordinary shares, which are held by the Group. The country of incorporation is also their principal place of business,
and the proportion of ownership interest is the same as the proportion of voting rights held. All investments listed below are
measured using the equity accounting method.
22002233
NNaammee ooff eennttiittyy
CCoouunnttrryy ooff
iinnccoorrppoorraattiioonn
%% ooff
oowwnneerrsshhiipp
NNaattuurree ooff
oowwnneerrsshhiipp
SShhaarree ooff
((lloossss))//pprrooffiitt
$$mm
CCaarrrryyiinngg
aammoouunntt
$$mm
MMaatteerriiaall
Destination Brisbane Consortium Integrated Resort
Holdings Pty Ltd (i)
Destination Gold Coast Investments Pty Ltd (ii)
Destination Gold Coast Consortium Pty Ltd (iii)
Australia
Australia
Australia
NNoonn mmaatteerriiaall
Australia
Festival Car Park Pty Ltd
Destination Sydney Consortium Investments Pty Ltd Australia
TToottaall eeqquuiittyy aaccccoouunntteedd iinnvveessttmmeennttss
50
50
33.3
50
50
Associate
Joint venture
Joint venture
Joint venture
Joint venture
((33..33))
00..66
66..77
553355..33
3366..77
7766..44
00..55
00..99
55..44
1144..88
66..00
666699..22
For those investments considered material to the Group, further information is provided below:
(i) DESTINATION BRISBANE CONSORTIUM INTEGRATED RESORT HOLDINGS PTY LTD
The Group has partnered with Hong Kong-based organisations Chow Tai Fook Enterprises Limited (CTF) and Far East
Consortium International Limited (FEC) to form Destination Brisbane Consortium (DDBBCC) for the Queen’s Wharf Brisbane
Project. The parties have formed two vehicles (the Integrated Resort Joint Venture and the Residential Joint Venture), which
together are responsible for completing the Queen’s Wharf Brisbane project.
Consistent with the ownership structure, the Group will contribute 50% of the capital to the development of the
entertainment and leisure destination and act as the casino operator under a long dated casino management agreement.
CTF and FEC will each contribute 25% of the capital to the development of the entertainment and leisure destination. The
Group's interest is accounted for using the equity method. CTF and FEC will each contribute 50% of the capital to undertake
the residential and related components of the broader Queen’s Wharf Brisbane development. The Group is not a party to the
residential apartments development joint venture.
The entertainment and leisure destination is anticipated to open from April 2024. Total project costs for DBC's development
of the entertainment and leisure destination are expected to be up ~10% on prior guidance of $2.6 billion. The majority of
these cost over-runs are to be funded via additional equity contributions in proportion with the existing joint venture interests.
CCoommmmiittmmeennttss aanndd ccoonnttiinnggeenntt lliiaabbiilliittiieess
DBC has current capital commitments of approximately $690.5 million (2022: $883.8 million) to fund the construction of the
entertainment and leisure destination, which is expected to open from April 2024 (subject to various approvals).
On 14 February 2018, Destination Brisbane Consortium Integrated Resort Operations Pty Ltd as trustee for the Destination
Brisbane Consortium Integrated Resort Operating Trust (‘Operating Trust’) entered into a $200 million performance
guarantee facility with Australia and New Zealand Banking Group Limited as Lender. This facility guarantee is in favour of the
State of Queensland and provided to secure due performance as developer under the Development Agreement – Queen’s
Wharf Brisbane. The parent entities of the unitholders of the Trust guarantee on a several basis the Trust’s performance
under the facility. On 8 July 2020, $125 million of the $200 million performance guarantee was returned from the State of
Queensland and subsequently cancelled by Australia and New Zealand Banking Group Limited.
78
120
78
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
DDiissppuuttee wwiitthh PPrroobbuuiilldd
DBC are in the process of finalising a statement of claim to be filed in the Supreme Court of Queensland. DBC seeks recovery
of certain mitigation costs (~$27m) which it alleges arise from Probuild’s breach of contract, negligence and breach of the
Australian Consumer Law.
DDiissppuuttee wwiitthh MMuullttiipplleexx
Multiplex (MMPPXX) is the principal contractor on the Queen’s Wharf Brisbane Integrated Resort Development project. Since early
2022 MPX has submitted a number of claims to DBC seeking damages and extensions of time and makes various
allegations against DBC and the principal’s representative. DBC claims that it is entitled to liquidated damages from MPX due
to its failure to meet contractual completion dates and commenced deducting liquidated damages from MPX in July 2023.
On 18 May 2023, MPX issued a Formal Dispute notice to DBC. MPX also included in its July 2023 progress claim, significant
claims for delay costs and acceleration costs and for repayment of liquidated damages deducted. These claims have been
reviewed and rejected by the Principal's Representative during the course of the contract. DBC delivered a detailed Payment
Schedule on 8 August 2023 rejecting these claims in total and deducting further liquidated damages from the monthly
amount that would have been payable to Multiplex. On 18 August 2023 DBC was served with a Statement of Claim filed by
MPX in the Supreme Court of Queensland. The claim seeks various declarations from the Court regarding extensions of time,
relevant milestone dates, liquidated damages, variations and certain other matters, including potential sums payable, in
connection with the contract and seeks various orders in relation to those matters. The Group understands that DBC intends
to defend the proceedings.
On 28 August 2023, DBC was issued with an adjudication application lodged by MPX with the Queensland Building and
Construction Commission under the Building Industry Fairness (Security of Payment) Act 2017 (Qld). The application is
seeking awards by the adjudicator for extensions of time, certification of stage completion, entitlements to liquidated
damages and payment of certain amounts (comprising delay costs, set-offs, acceleration costs, variations and other
amounts). The adjudication claim is separate to the Supreme Court proceedings. The Group understands that DBC is
currently reviewing the adjudication application and that it intends to respond in accordance with the process in the relevant
legislation.
SSuummmmaarriisseedd ffiinnaanncciiaall iinnffoorrmmaattiioonn
The financial statements of the associate is prepared for the same reporting period as the Group and follow the same
accounting policies of the Group.
BBaallaannccee sshheeeett
Cash and cash equivalents
Total current assets excluding cash and cash equivalents
Total non current assets
Total current liabilities
Total non current liabilities
NNeett aasssseettss
RReeccoonncciilliiaattiioonn ttoo iinnvveessttmmeenntt ccaarrrryyiinngg aammoouunntt::
Carrying amount at the beginning of the year
Share of loss for the period
CCaarrrryyiinngg aammoouunntt aatt tthhee eenndd ooff tthhee yyeeaarr
IInnccoommee ssttaatteemmeenntt
Interest revenue
Depreciation and amortisation expense
Operating expenses
LLoossss bbeeffoorree ttaaxx
Income tax benefit
LLoossss ffoorr tthhee yyeeaarr ((ccoonnttiinnuuiinngg ooppeerraattiioonnss))
TToottaall ccoommpprreehheennssiivvee lloossss ffoorr tthhee yyeeaarr ((ccoonnttiinnuuiinngg ooppeerraattiioonnss))
GGrroouupp''ss sshhaarree ooff lloossss ffoorr tthhee yyeeaarr
22002233
$$mm
22002222
$$mm
9999..77
4488..00
22,,337711..88
((110099..88))
((11,,225599..11))
156.7
19.3
1,946.9
(107.8)
(846.3)
11,,115500..66
1,168.8
553388..66
((33..33))
553355..33
--
((22..00))
((44..55))
((66..55))
--
((66..55))
((66..55))
((33..33))
543.9
(5.3)
538.6
0.2
(2.2)
(8.6)
(10.6)
-
(10.6)
(10.6)
(5.3)
79
79
121
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
(ii) DESTINATION GOLD COAST INVESTMENTS PTY LTD
On 20 October 2016, a 50% interest was acquired in Destination Gold Coast Investments Pty Ltd (DGCI). DGCI is a joint
venture with CTF and FEC involved in the operation of the Sheraton Grand Mirage Resort, Gold Coast. The Group's interest is
accounted for using the equity method
The Securityholders’ Deed for Destination Gold Coast Investments Pty Ltd requires unanimous consent for each Board
resolution. Due to the unanimous requirement for decisions, each party has joint control of the entity. The entity is designed
to exist on its own and the Deed does not grant the rights to assets and liabilities directly to the Group. The investment has
therefore been classified as a joint venture.
CCoommmmiittmmeennttss aanndd ccoonnttiinnggeenntt lliiaabbiilliittiieess
The joint venture had no capital commitments as at 30 June 2023 (2022: nil). There were no other contingent liabilities.
SSuummmmaarriisseedd ffiinnaanncciiaall iinnffoorrmmaattiioonn
The financial statements of the joint venture are prepared for the same reporting period as the Group and follow the same
accounting policies of the Group.
BBaallaannccee sshheeeett
Cash and cash equivalents
Total current assets excluding cash and cash equivalents
Total non current assets
Total current liabilities
Total non current liabilities - financial liabilities
Other non current liabilities
NNeett aasssseettss
RReeccoonncciilliiaattiioonn ttoo iinnvveessttmmeenntt ccaarrrryyiinngg aammoouunntt::
Carrying amount at the beginning of the year
Share of profit for the period
CCaarrrryyiinngg aammoouunntt aatt tthhee eenndd ooff tthhee yyeeaarr
IInnccoommee ssttaatteemmeenntt
Revenue
Interest expense
Depreciation and impairment expense
Operating expenses
PPrrooffiitt bbeeffoorree ttaaxx
Income tax expense
PPrrooffiitt ffoorr tthhee yyeeaarr ((ccoonnttiinnuuiinngg ooppeerraattiioonnss))
TToottaall ccoommpprreehheennssiivvee pprrooffiitt ffoorr tthhee yyeeaarr ((ccoonnttiinnuuiinngg ooppeerraattiioonnss))
GGrroouupp''ss sshhaarree ooff pprrooffiitt ffoorr tthhee yyeeaarr
80
122
22002233
$$mm
88..99
114477..99
--
((7722..33))
--
((1111..11))
7733..44
3366..11
00..66
3366..77
5566..77
((33..11))
((22..55))
((4499..11))
22..00
((00..66))
11..44
11..44
00..66
22002222
$$mm
13.7
1.7
148.0
(10.3)
(67.5)
(13.5)
72.1
35.9
0.2
36.1
44.2
(1.4)
(3.6)
(38.7)
0.5
(0.1)
0.4
0.4
0.2
80
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
(iii) DESTINATION GOLD COAST CONSORTIUM PTY LTD
On 22 November 2016, a 33.3% interest was acquired in Destination Gold Coast Consortium Pty Ltd (DDGGCCCC). DGCC is a joint
venture with CTF and FEC for the purpose of constructing a new residential and hotel tower in Gold Coast. The Group's
interest is accounted for using the equity method.
CCoommmmiittmmeennttss aanndd ccoonnttiinnggeenntt lliiaabbiilliittiieess
DGCC has current capital commitments of $102.4 million (2022: $120.1 million) in relation to Tower 2. DGCC is seeking
project level debt facilities for the remainder of the Tower 2 construction costs. Until such time as a facility is secured,
committed spend is to be funded by equity contributions. There were no other contingent liabilities.
SSuummmmaarriisseedd ffiinnaanncciiaall iinnffoorrmmaattiioonn
The financial statements of the joint venture are prepared for the same reporting period as the Group and follow the same
accounting polices of the Group.
BBaallaannccee sshheeeett
Cash and cash equivalents
Total current assets excluding cash and cash equivalents
Total non current assets
Total current liabilities
Total non current liabilities
NNeett aasssseettss
RReeccoonncciilliiaattiioonn ttoo iinnvveessttmmeenntt ccaarrrryyiinngg aammoouunnttss::
Carrying amount at the beginning of the year
Share of profit for the period
Share of equity contributions for the Group
Distributions received
Other
CCaarrrryyiinngg aammoouunntt aatt tthhee eenndd ooff tthhee yyeeaarr
IInnccoommee ssttaatteemmeenntt
Revenue and other income
Operating expenses
Depreciation and amortisation expense
Finance costs
PPrrooffiitt bbeeffoorree ttaaxx
Income tax expense
PPrrooffiitt ffoorr tthhee yyeeaarr ((ccoonnttiinnuuiinngg ooppeerraattiioonnss))
TToottaall ccoommpprreehheennssiivvee pprrooffiitt ffoorr tthhee yyeeaarr ((ccoonnttiinnuuiinngg ooppeerraattiioonnss))
22002233
$$mm
4488..66
8855..44
447733..33
((110022..99))
((224422..22))
226622..22
7733..66
55..55
1177..99
((2211..88))
11..22
7766..44
111177..44
(92.1)
((55..33))
((33..55))
1166..55
--
1166..55
1166..55
22002222
$$mm
35.8
165.1
328.2
(173.2)
(98.4)
257.5
30.4
19.8
19.6
-
3.8
73.6
285.4
(221.2)
(2.7)
(2.1)
59.4
-
59.4
59.4
GGrroouupp''ss sshhaarree ooff pprrooffiitt ffoorr tthhee yyeeaarr
SSiiggnniiffiiccaanntt aaccccoouunnttiinngg ppoolliicciieess
The following accounting policy is unique to DGCC's accounting within the Group.
AAppaarrttmmeenntt ssaalleess rreevveennuuee
Revenue in respect of the development project is recognised upon fulfillment of all performance obligations on a contract.
The revenue is measured at the transaction price agreed under the contract. Payment is received on actual settlement of
individual units when risk and benefits of ownership are transferred to the customer.
55..55
19.8
81
81
123
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
RISK MANAGEMENT
E
E1 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group's principal financial instruments, other than derivatives, comprise cash, short-term deposits, Australian
denominated bank loans, and foreign currency denominated notes.
The main purpose of these financial instruments is to provide funding for the Group's operations. The Group has various
other financial assets and liabilities such as trade receivables and trade payables, which arise directly from its operations.
Derivative transactions are also entered into by the Group, being interest rate swaps, cross currency swaps and forward
currency contracts, the purpose being to manage interest rate and currency risks arising from the Group's operations and
sources of finance.
The Group's risk management policy is carried out by the Group Treasury function under the Group Treasury Policy approved
by the Board. Group Treasury reports regularly to the Board on the Group's risk management activities and compliance with
policies. It is, and has been throughout the period under review, the Group's policy that no speculative trading in financial
instruments shall be undertaken.
The main risks arising from the Group's financial instruments are interest rate risk, foreign currency risk, credit risk and
liquidity risk.
Details of significant accounting policies and methods adopted, including criteria for recognition, the basis of measurement
and the basis on which income and expenses are recognised, in respect of each class of financial asset, financial liability and
equity instrument, are disclosed in note G.
IInntteerreesstt rraattee rriisskk
The Group manages interest rate risk by using a floating versus fixed rate debt framework. The relative mix of fixed and
floating interest rate exposure is managed through the issuance of both fixed rate and floating rate debt and by using
interest rate swap contracts. The Group manages its cash flow interest rate risk by using floating-to-fixed interest rate swap
contracts.
FFoorreeiiggnn ccuurrrreennccyy rriisskk
As a result of issuing private placement notes denominated in US Dollars (UUSSDD), the Group's balance sheet can be affected
by movements in the USD/AUD exchange rate. In order to manage this exposure, the Group has entered into cross currency
swaps to fix the exchange rate on the notes until maturity. The Group agrees to exchange a fixed USD amount for an agreed
Australian Dollar (AAUUDD) amount with swap counterparties, and re-exchange this again at maturity. These swaps are
designated to hedge the USD principal and interest obligations under the private placement notes.
CCrreeddiitt rriisskk
Credit risk on financial assets which have been recognised on the balance sheet, is the carrying amount less any allowance
for non recovery. The Group minimises credit risk via adherence to a strict credit risk management policy. Collateral is not
held as security.
CCuussttoommeerr ccrreeddiitt rriisskk
Credit risk in trade receivables is managed in the following ways:
The provision of cheque cashing facilities for casino gaming patrons is subject to detailed policies and procedures
designed to minimise any potential loss, including the use of a central credit agency which collates information from the
major casinos around the world; and
The provision of non gaming credit is covered by a risk assessment process for customers using the Credit Reference
Association of Australia, bank opinions and trade references.
Receivable balances are monitored on an ongoing basis with the result that the Group's exposure to bad debts is carefully
managed and controlled.
FFiinnaanncciiaall iinnssttiittuuttiioonn ccrreeddiitt rriisskk
Credit risk arising from other financial assets of the Group, which comprise cash, cash equivalents and derivative contracts,
is reduced by transacting with relationship banks that have acceptable credit ratings, as determined by a recognised ratings
agency.
Cash investments, derivative financial instruments, bank guarantees, and other contingent instruments create credit risk in
relation to the relevant counterparties, which are principally large relationship banks. As such, there is a low level of credit
risk.
The maximum counterparty credit exposure on forward currency and cross currency swaps is the fair value amount that the
Group receives when settlement occurs, should the counterparty fail to pay the amount which it has committed to pay the
Group. The credit risk on interest rate hedges is limited to the positive mark to market amount to be received from
counterparties over the life of contracts that are favourable to the Group. The Group's maximum credit risk exposure in
respect of interest rate swap contracts, cross currency swap contracts and forward currency contracts is detailed in note E2.
82
82
124
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
CCrreeddiitt rriisskk iinncclluuddeess lliiaabbiilliittiieess uunnddeerr ffiinnaanncciiaall gguuaarraanntteeeess
For financial guarantee contract liabilities, the fair value at initial recognition is determined using a probability weighted
discounted cash flow approach. The fair value of financial guarantee contract liabilities has been assessed as nil (2022: nil),
as the possibility of an outflow occurring is considered remote. Details of the financial guarantee contracts in the balance
sheet are outlined below.
FFiixxeedd aanndd ffllooaattiinngg cchhaarrggeess
The controlled entities denoted (b) in note D1 have provided the NICC with a fixed and floating charge over all of the assets
and undertakings of each company to secure payment of all monies and the performance of all obligations which they have
to the NICC.
GGuuaarraanntteeeess aanndd iinnddeemmnniittiieess
The controlled entities denoted (b) in note D1 have entered into a guarantee and indemnity agreement in favour of ILGA
whereby all parties to the agreement are jointly and severally liable for the performance of the obligations and liabilities of
each company participating in the agreement with respect to agreements entered into and guarantees given.
The Star Entertainment Group Limited has guaranteed the liabilities of The Star Entertainment Finance Limited, The Star
Entertainment International No.3 Pty Ltd and the customer loans for EEI Services (Hong Kong) Limited. As at 30 June 2023,
the carrying amount included in current liabilities was $12.0 million (2022: $12.0 million), and the maximum amount of
these guarantees was $58.8 million (2022: $68.1 million).
LLiiqquuiiddiittyy rriisskk
Liquidity risk arises from the financial liabilities of the Group and the Group's subsequent ability to meet its obligations to
repay its financial liabilities as and when they fall due.
The Group manages liquidity risk through maintaining sufficient cash and adequate amount of undrawn committed credit
facilities to be held above the forecast requirements of the business. The Group manages liquidity risk centrally by monitoring
cash flow forecasts and maintaining adequate cash reserves and debt facilities. The debt portfolio is periodically reviewed to
ensure there is funding flexibility across an appropriate maturity profile.
Refer to notes B8 and E2 for maturity of financial liabilities.
The contractual timing of cash flows on derivatives and non-derivative financial assets and liabilities at the reporting date,
including drawn borrowings and estimated interest, are set out in the tables below:
(i) NON-DERIVATIVE FINANCIAL INSTRUMENTS
FFiinnaanncciiaall aasssseettss
Cash assets
Short term deposits
Trade and other receivables
FFiinnaanncciiaall lliiaabbiilliittiieess
Trade and other payables
Bank loans - unsecured
Lease liabilities
Private placement - US dollar
<< 11 yyeeaarr
$$mm
2023
11 -- 55 yyeeaarrss
$$mm
>> 55 yyeeaarrss
$$mm
<< 11 yyeeaarr
$$mm
2022
11 -- 55 yyeeaarrss
$$mm
>> 55 yyeeaarrss
$$mm
7799..22
99..55
2200..88
110099..55
118822..00
2266..11
88..88
3377..66
225544..55
--
--
--
--
--
336688..77
2299..22
440099..00
880066..99
--
--
--
--
--
--
6699..66
6622..33
113311..99
82.0
-
18.0
100.0
202.9
28.6
9.3
24.8
265.6
-
-
-
-
-
738.7
33.2
157.4
929.3
-
-
-
-
-
-
74.4
469.8
544.2
NNeett oouuttffllooww
((114455..00))
((880066..99))
((113311..99))
(165.6)
(929.3)
(544.2)
83
83
125
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
(ii) DERIVATIVE FINANCIAL INSTRUMENTS
FFiinnaanncciiaall aasssseettss
Interest rate swaps - receive AUD floating
Cross currency swaps - receive USD fixed
FFiinnaanncciiaall lliiaabbiilliittiieess
Interest rate swaps - pay AUD fixed
Cross currency swaps - pay AUD floating
Cross currency swaps - pay AUD fixed
NNeett ((oouuttffllooww))//iinnffllooww
<< 11 yyeeaarr
$$mm
2023
11 -- 55 yyeeaarrss
$$mm
>> 55 yyeeaarrss
$$mm
<< 11 yyeeaarr
$$mm
2022
11 -- 55 yyeeaarrss
$$mm
>> 55 yyeeaarrss
$$mm
44..22
1144..99
1199..11
11..55
44..88
1133..11
1199..44
((00..33))
11..88
333399..55
334411..33
11..00
7766..44
222266..33
330033..77
3377..66
--
6611..44
6611..44
--
--
5566..22
5566..22
55..22
2.8
24.8
27.6
2.6
11.5
19.0
33.1
2.5
157.4
159.9
2.5
103.3
76.1
181.9
-
469.8
469.8
-
146.3
324.7
471.0
(5.5)
(22.0)
(1.2)
For floating rate instruments, the amount disclosed is determined by reference to the interest rate at the last repricing date.
For foreign currency receipts and payments, the amount disclosed is determined by reference to the AUD/USD rate at
balance sheet date.
(iii) FINANCIAL INSTRUMENTS - SENSITIVITY ANALYSIS
IInntteerreesstt rraatteess -- AAUUDD aanndd UUSSDD
The following sensitivity analysis is based on interest rate risk exposures in existence at year end.
At 30 June, if interest rates had moved, as illustrated in the table below, with all other variables held constant, post tax profit
and other comprehensive income would have been affected as follows:
22002233
AAUUDD
+ 0.5% (50 basis points)
- 0.5% (50 basis points)
UUSSDD
+ 0.5% (50 basis points)
- 0.5% (50 basis points)
2022
AAUUDD
+ 0.5% (50 basis points)
- 0.5% (50 basis points)
UUSSDD
+ 0.5% (50 basis points)
- 0.5% (50 basis points)
84
126
NNeett pprrooffiitt aafftteerr ttaaxx
hhiigghheerr//((lloowweerr))
$$mm
OOtthheerr
ccoommpprreehheennssiivvee
iinnccoommee
hhiigghheerr//((lloowweerr))
$$mm
((22..00))
22..00
--
--
(2.5)
2.5
-
-
55..22
((55..33))
((66..22))
66..33
21.0
1.8
25.9
(2.5)
84
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
The movements in profit are due to higher/lower interest costs from variable rate debt and investments. The movement in
other comprehensive income is due to an increase/decrease in the fair value of financial instruments designated as cash
flow hedges.
The numbers derived in the sensitivity analysis are indicative only.
Significant assumptions used in the interest rate sensitivity analysis include:
reasonably possible movements in interest rates were determined based on the Group's current credit rating and mix of
debt; and
price sensitivity of derivatives is based on a reasonably possible movement of spot rates at the balance sheet dates.
FFoorreeiiggnn EExxcchhaannggee
The following sensitivity analysis is based on foreign currency risk exposures in existence at the balance sheet date. At 30
June, had the AUD moved, as illustrated in the table below, with all other variables held constant, post tax profit and other
comprehensive income would have been affected as follows:
Judgements of reasonably possible movements:
NNeett pprrooffiitt aafftteerr ttaaxx
hhiigghheerr//((lloowweerr))
OOtthheerr
ccoommpprreehheennssiivvee
iinnccoommee
hhiigghheerr//((lloowweerr))
NNeett pprrooffiitt aafftteerr ttaaxx
hhiigghheerr//((lloowweerr))
OOtthheerr
ccoommpprreehheennssiivvee
iinnccoommee
hhiigghheerr//((lloowweerr))
2023
$m
11..11
((11..66))
2023
$m
((00..88))
11..11
2022
$m
(0.3)
0.4
2022
$m
7.8
16.5
AUD/USD + 10 cents
AUD/USD - 10 cents
The movement in other comprehensive income is due to an increase/decrease in the fair value of financial instruments
designated as cash flow hedges. Management believes the balance sheet date risk exposures are representative of the risk
exposure inherent in the financial instruments. The numbers derived in the sensitivity analysis are indicative only.
Significant assumptions used in the foreign currency exposure sensitivity analysis include:
reasonably possible movements in foreign exchange rates were determined based on a review of the last two years'
historical movements and economic forecaster's expectations;
the reasonably possible movement of 10 cents was calculated by taking the USD spot rate as at balance sheet date,
moving this spot rate by 10 cents and then re-converting the USD into AUD with the 'new spot-rate'. This methodology
reflects the translation methodology undertaken by the Group; and
price sensitivity of derivatives is based on a reasonably possible movement of spot rates at the balance sheet dates.
85
85
127
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
E2 ADDITIONAL FINANCIAL INSTRUMENTS DISCLOSURES
(i) FAIR VALUES
The fair value of the Group's financial assets and financial liabilities approximates their carrying value as at the balance
sheet date.
There are various methods available in estimating the fair value of a financial instrument. The methods comprise:
Level 1
the fair value is calculated using quoted prices in active markets.
the fair value is estimated using inputs other than quoted prices included in Level 1 that are observable for the
asset or liability, either directly (as prices) or indirectly (derived from prices).
the fair value is estimated using inputs for the asset or liability that are not based on observable market data.
Level 2
Level 3
All of the Group's derivative financial instruments are valued using the Level 2 valuation techniques, being observable inputs.
There have been no transfers between levels during the year.
IInntteerreesstt rraattee sswwaappss aanndd ccrroossss ccuurrrreennccyy sswwaappss
The fair value of cross currency contracts is calculated as the present value of expected future cash flows of these
instruments. Key variables include market pricing data, discount rates and credit risk of the group or counterparty where
relevant. Variables reflect those which would be used by the market participants to execute and value the instruments.
FFoorrwwaarrdd ccuurrrreennccyy ccoonnttrraaccttss
Fair value is calculated using forward exchange market rates at the balance sheet date.
UUSSPPPP
Fair value is calculated using discounted future cash flow techniques, where estimated cash flows and estimated discount
rates are based on market data at the balance sheet date, in combination with restatement to current foreign exchange
rates.
(ii) FINANCIAL INSTRUMENTS - INTEREST RATE SWAPS
Interest rate swaps meet the requirements to qualify for cash flow hedge accounting and are stated at fair value.
These swaps are used to hedge the exposure to variability in cash flows attributable to movements in the reference interest
rate of the designated debt or instrument and are assessed as highly effective in offsetting changes in the cash flows
attributable to such movements. Hedge effectiveness is measured by comparing the change in the fair value of the hedged
item and the hedging instrument respectively each quarter. Any difference represents ineffectiveness and is recorded in the
income statement.
The notional principal amounts and periods of expiry of the interest rate swap contracts are as follows:
Less than one year
One to five years
More than five years
Notional Principal
2023
$m
50.0
50.0
-
100.0
2022
$m
150.0
100.0
-
250.0
Fixed interest rate range p.a.
0.4% - 2.6% 0.4% - 2.6%
Net settlement receipts and payments are recognised as an adjustment to interest expense on an accruals basis over the
term of the swaps, such that the overall interest expense on borrowings reflects the average cost of funds achieved by
entering into the swap agreements.
(iii) FINANCIAL INSTRUMENTS - CROSS CURRENCY SWAPS
CCaasshh ffllooww hheeddggeess
Cross currency swap contracts are classified as cash flow hedges and are stated at fair value.
These cross currency swaps are being used to hedge the exposure to the cash flow variability in the value of the USD debt
under the USPP and are assessed as highly effective in offsetting changes in movements in the forward USD exchange rate.
Hedge effectiveness is measured by comparing the change in the fair value of the hedged item and the hedging instrument
respectively each quarter. Any difference represents ineffectiveness and is recorded in the income statement.
86
128
86
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
FFaaiirr vvaalluuee hheeddggeess
These cross currency swaps are being used to hedge the exposure to fair value changes of the USD debt under the USPP as
a result of fluctuations in the underlying USD to AUD exchange rate and US interest benchmark and are assessed as highly
effective. The increase in fair value of the cross currency swaps of $2.4 million (2022: $22.4 million decrease in value) has
been recognised in finance costs and offsetting loss on the USPP borrowings. The ineffectiveness recognised in FY23 was
immaterial (2022: immaterial).
The principal amounts and periods of expiry of the cross currency swap contracts are as follows:
Less than one year
One to five years
More than five years
Notional principal
22002233
22002222
AAUUDD $$mm
UUSSDD $$mm
AAUUDD $$mm
UUSSDD $$mm
--
225500..33
5544..22
330044..55
--
119955..44
4400..44
223355..88
-
433.4
93.9
527.3
-
338.4
70.0
408.4
Fixed interest rate range p.a.
33..22%% -- 44..44%%
3.2% - 4.4%
The terms and conditions in relation to interest rate and maturity of the cross currency swaps are similar to the terms and
conditions of the underlying hedged USPP borrowings as set out in note B8.
(iv) RECONCILIATION OF MOVEMENT IN FINANCING ACTIVITIES
OOppeenniinngg
CCaasshh fflloowwss
CChhaannggeess
iinn ffaaiirr
vvaalluueess
FFoorreeiiggnn
eexxcchhaannggee
mmoovveemmeenntt
DDeebbtt
mmooddiiffiiccaattiioonn
NNeett lloossss oonn
sseettttlleemmeenntt
BBoorrrroowwiinngg
ccoossttss
CClloossiinngg
$$mm
$$mm
$$mm
$$mm
$$mm
$$mm
$$mm
$$mm
22002233
Interest bearing liabilities (excluding lease
liabilities) (refer to note B8)
Net derivative assets (refer to note B3)
(1,289.6)
58.6
603.1
(20.5)
(2.4)
(1.9)
(12.1)
--
22002222
Interest bearing
significant items) (refer to note B8)
liabilities
(excluding
Net derivative assets (refer to note B3)
22002233
Lease liabilities (refer to note B8)
22002222
Lease liabilities (refer to note B8)
(1,242.5)
(21.9)
3.2
-
22.4
55.4
(46.5)
--
(10.9)
(8.1)
(0.4)
((772200..44))
-
-
-
-
-
-
-
3366..22
(1.1)
(1,289.6)
-
58.6
OOppeenniinngg
CCaasshh fflloowwss
IInntteerreesstt
TTrraannssiittiioonn
AAddddiittiioonnss
OOtthheerr
DDiissppoossaallss
CClloossiinngg
$$mm
$$mm
$$mm
$$mm
$$mm
$$mm
$$mm
$$mm
(42.9)
9.6
(3.1)
(50.2)
9.5
(3.5)
--
-
-
-
-
-
((3366..88))
(0.4)
1.7
(42.9)
87
87
129
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
F
OTHER DISCLOSURES
F1 OTHER COMPREHENSIVE INCOME
Net (loss)/gain on derivatives
Tax on above items recognised in other comprehensive income
F2 INCOME TAX
(i)
INCOME TAX BENEFIT
TThhee mmaajjoorr ccoommppoonneennttss ooff iinnccoommee ttaaxx bbeenneeffiitt iiss::
Current tax benefit/(expense)
Adjustments in respect of current income tax of previous years
Deferred income tax benefit
Income tax benefit reported in the income statement
AAggggrreeggaattee ooff ccuurrrreenntt aanndd ddeeffeerrrreedd ttaaxx rreellaattiinngg ttoo iitteemmss cchhaarrggeedd oorr
ccrreeddiitteedd ttoo eeqquuiittyy::
Current tax benefit reported in equity
Deferred tax benefit/(expense) reported in equity
Income tax benefit/(expense) reported in equity
IInnccoommee ttaaxx bbeenneeffiitt
income tax benefit and the product of
A reconciliation between
accounting profit before income tax multiplied by the income tax rate is as
follows:
Accounting loss before income tax benefit
At the Group's statutory income tax rate of 30%
- Non deductible goodwill impairment
- Non assessable gain on sale
- Recognition/(derecognition) of temporary differences
- Non deductible expenses
- Over provision in prior years
- Other items
Aggregate income tax expense
Effective income tax rate
88
130
2023
$m
((99..33))
22..88
((66..55))
22002233
$$mm
2222..44
66..55
229988..99
332277..88
00..66
99..33
99..99
(2,763.0)
828.9
(361.3)
10.3
(2.6)
(149.0)
1.5
-
327.8
((1111..99))
%%
2022
$m
29.3
(8.8)
20.5
22002222
$$mm
(1.2)
1.7
2.6
3.1
0.5
(8.8)
(8.3)
(205.6)
61.7
(48.8)
(9.7)
0.1
-
-
(0.2)
3.1
%1.5
88
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
(ii) DEFERRED TAX BALANCES
The balance comprises temporary differences attributable to:
22002233
Property, plant and equipment
Intangible assets
Employee provisions
Other provisions and accruals
Impairment of trade receivables
Unrealised financial liabilities
Finance leases
Other
Tax losses
DDeeffeerrrreedd ttaaxx aasssseettss sseett ooffff
Intangible assets
Property, plant and equipment
Unrealised financial assets
Other
NNeett ddeeffeerrrreedd ttaaxx ((lliiaabbiilliittiieess))//aasssseettss
22002222
Employee provisions
Other provisions and accruals
Impairment of trade receivables
Unrealised financial liabilities
Finance leases
Other
DDeeffeerrrreedd ttaaxx aasssseettss sseett ooffff
Intangible assets
Property, plant and equipment
Unrealised financial assets
Other
NNeett ddeeffeerrrreedd ttaaxx ((lliiaabbiilliittiieess))//aasssseettss
BBaallaannccee
11 JJuullyy 22002222
$$mm
RReeccooggnniisseedd
iinn tthhee iinnccoommee
ssttaatteemmeenntt
$$mm
RReeccooggnniisseedd
ddiirreeccttllyy iinn
eeqquuiittyy
$$mm
--
--
3300..11
1177..33
1111..22
1188..66
1133..33
77..99
--
9988..44
((5544..77))
((114444..55))
((1199..33))
((2200..88))
((223399..33))
((114400..99))
9933..99
2277..88
((66..33))
66..44
((11..33))
((22..88))
((11..99))
((88..44))
55..11
111122..55
2211..77
113388..00
77..77
1199..00
118866..44
229988..99
--
--
--
--
--
33..11
--
66..55
--
99..66
--
--
((00..33))
--
((00..33))
99..33
BBaallaannccee
11 JJuullyy 22002211
$$mm
RReeccooggnniisseedd
iinn tthhee iinnccoommee
ssttaatteemmeenntt
$$mm
RReeccooggnniisseedd
ddiirreeccttllyy iinn
eeqquuiittyy
$$mm
23.9
14.6
11.5
14.0
15.0
8.4
87.4
(59.6)
(145.1)
(5.1)
(11.9)
(221.7)
(134.3)
6.2
3.2
(0.3)
(0.9)
(1.7)
(0.5)
6.0
4.9
0.6
-
(8.9)
(3.4)
2.6
-
-
-
5.5
-
-
5.5
-
-
(14.2)
-
(14.2)
(8.7)
OOtthheerr
$$mm
--
--
--
--
--
--
--
--
2233..11
2233..11
--
--
--
--
--
2233..11
OOtthheerr
$$mm
-
(0.5)
-
-
-
-
(0.5)
-
-
-
-
-
(0.5)
BBaallaannccee
3300 JJuunnee 22002233
$$mm
9933..99
2277..88
2233..88
2233..77
99..99
1188..99
1111..44
66..00
2288..22
224433..66
((3333..00))
((66..55))
((1111..99))
((11..88))
((5533..22))
119900..44
BBaallaannccee
3300 JJuunnee 22002222
$$mm
30.1
17.3
11.2
18.6
13.3
7.9
98.4
(54.7)
(144.5)
(19.3)
(20.8)
(239.3)
(140.9)
89
89
131
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
(iii) TAX CONSOLIDATION
Effective June 2011, The Star Entertainment Group Limited (the HHeeaadd CCoommppaannyy) and its 100% owned subsidiaries formed
an income tax consolidation group. Members of the tax consolidation group entered into a tax sharing arrangement that
provides for the allocation of income tax liabilities between the entities should the Head Company default on its tax payment
obligations. At balance date, the possibility of default is remote.
TTaaxx eeffffeecctt aaccccoouunnttiinngg bbyy mmeemmbbeerrss ooff tthhee ttaaxx ccoonnssoolliiddaattiioonn ggrroouupp
Members of the tax consolidation group have entered into a tax funding agreement effective June 2011. Under the terms of
the tax funding agreement, the Head Company and each of the members in the tax consolidation group have agreed to make
a tax equivalent payment to or from the Head Company, based on the current tax liability or current tax asset of the member.
Deferred taxes are recorded by members of the tax consolidation group in accordance with the principles of AASB 112
'Income Taxes'. Calculations under the tax funding agreement are undertaken for statutory reporting purposes.
The allocation of taxes under the tax funding agreement is recognised as either an increase or decrease in the subsidiaries'
intercompany accounts with the Head Company. The Group has chosen to adopt the Group Allocation method as outlined in
Interpretation 1052 'Tax Consolidation Accounting' as the basis to determine each members' current and deferred taxes. The
Group Allocation method as adopted by the Group will not give rise to any contribution or distribution of the subsidiaries'
equity accounts as there will not be any differences between the current tax amount that is allocated under the tax funding
agreement and the amount that is allocated under the Group Allocation method.
(iv) INCOME TAX PAYABLE
The balance of income tax payable is the net of current tax and tax instalments/refunds during the year. A current tax liability
arises where current tax exceeds tax instalments paid and a current tax receivable arises where tax instalments paid exceed
current tax.
TThhee iinnccoommee ttaaxx ((ppaayyaabbllee))//rreecceeiivvaabbllee bbaallaannccee iiss aattttrriibbuuttaabbllee ttoo::
The receivable balance relates to depreciation for capital projects.
22002233
Tax consolidated group - year ended
30 June 2023
Tax consolidated group - year ended
30 June 2022
Prior years a
TToottaall AAuussttrraalliiaa
Overseas subsidiaries
Tax consolidated group - year ended
30 June 2022 a
Tax consolidated group - year ended
30 June 2021
Prior years b
TToottaall AAuussttrraalliiaa
Overseas subsidiaries
TToottaall
a
22002222
TToottaall
a
b
90
132
((PPaayyaabbllee))//
rreecceeiivvaabbllee
11 JJuullyy 22002222
IInnccrreeaassee iinn
ttaaxx ppaayyaabbllee
TTaaxx iinnssttaallmmeenntt
ppaaiidd
OOvveerr
pprroovviissiioonn ooff
ttaaxx
$$mm
--
((11..77))
66..00
44..33
00..11
44..44
$$mm
$$mm
$$mm
--
--
--
--
--
--
1166..44
33..55
--
1199..99
00..11
2200..00
--
11..77
55..00
66..77
((00..22))
66..55
((PPaayyaabbllee))//
rreecceeiivvaabbllee
11 JJuullyy 22002211
$$mm
IInnccrreeaassee iinn
ttaaxx ppaayyaabbllee
$$mm
TTaaxx iinnssttaallmmeenntt
ppaaiidd
$$mm
OOvveerr
pprroovviissiioonn ooff
ttaaxx
$$mm
-
(1.7)
(6.2)
4.8
(1.4)
0.4
(1.0)
-
-
(1.7)
-
(1.7)
-
5.1
-
5.1
-
5.1
-
1.1
0.9
2.0
(0.3)
1.7
OOtthheerr
$$mm
--
--
((00..11))
((00..11))
--
((00..11))
OOtthheerr
$$mm
-
-
0.3
0.3
-
0.3
RReecceeiivvaabbllee
3300 JJuunnee
22002233
$$mm
1166..44
33..55
1100..99
3300..88
--
3300..88
((PPaayyaabbllee))//
rreecceeiivvaabbllee
3300 JJuunnee
22002222
$$mm
(1.7)
-
6.0
4.3
0.1
4.4
90
No instalments were paid.
The receivable balance relates to depreciation for capital projects.
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
F3 LOSS PER SHARE
NNeett lloossss aafftteerr ttaaxx aattttrriibbuuttaabbllee ttoo oorrddiinnaarryy sshhaarreehhoollddeerrss
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
WWeeiigghhtteedd aavveerraaggee nnuummbbeerr ooff sshhaarreess uusseedd aass tthhee ddeennoommiinnaattoorr
Number of ordinary shares issued at the beginning of the year
Adjustment for issue of new share capital on 7 March 2023 a
Adjustment for issue of new share capital on 20 March 2023 b
Movement in treasury shares
22002233
$$mm
((22,,443355..22))
((221111..77))
((221111..77))
22002233
NNuummbbeerr
22002222
$$mm
(202.5)
(21.3)
(21.3)
22002222
NNuummbbeerr
995500,,111188,,776677
946,489,027
113355,,772233,,447733
6655,,992200,,555500
-
-
((11,,660022,,774499))
2,754,899
WWeeiigghhtteedd aavveerraaggee nnuummbbeerr ooff sshhaarreess uusseedd aass tthhee ddeennoommiinnaattoorr
11,,115500,,116600,,004411
949,243,926
AAddjjuussttmmeenntt ffoorr ccaallccuullaattiioonn ooff ddiilluutteedd eeaarrnniinnggss ppeerr sshhaarree::
Adjustment for Performance Rights
--
-
WWeeiigghhtteedd aavveerraaggee nnuummbbeerr ooff oorrddiinnaarryy sshhaarreess aanndd ppootteennttiiaall oorrddiinnaarryy sshhaarreess aass
uusseedd aass tthhee ddeennoommiinnaattoorr iinn ccaallccuullaattiinngg ddiilluutteedd eeaarrnniinnggss ppeerr sshhaarree aatt tthhee eenndd ooff
949,243,926
tthhee yyeeaarr
a On 7 March 2023, the Group issued 430,774,501 new shares for private placement to institutional investors under the accelerated non-
renounceable entitlement offer.
b On 20 March 2023, the Group issued 235,892,166 new shares for retail component of the accelerated non-renounceable entitlement
offer (including shares issued to Chow Tai Fook Enterprises Limited and Far East Consortium International Limited under the placement and
institutional entitlement offer, in accordance with the retail entitlement offer timetable).
1,515,791 performance rights (2022: 2,193,154) could potentially dilute basic earnings per share in the future, but were
not included in the calculation above because they are antidilutive for the period presented.
11,,115500,,116600,,004411
F4 OTHER ASSETS
CCuurrrreenntt
Prepayments
Other assets
NNoonn ccuurrrreenntt
Rental paid in advance
Other assets
F5 TRADE AND OTHER PAYABLES
Trade creditors and accrued expenses
Interest payable
22002233
$$mm
4433..00
5500..77
9933..77
00..88
2255..99
2266..77
118822..00
22..99
118844..99
22002222
$$mm
35.9
43.6
79.5
0.8
39.1
39.9
202.9
3.5
206.4
91
91
133
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
F6 OTHER LIABILITIES
CCuurrrreenntt
Customer loyalty deferred revenue a
Other deferred revenue
NNoonn ccuurrrreenntt
Other
22002233
$$mm
1166..33
22..33
1188..66
1111..11
1111..11
22002222
$$mm
19.1
4.0
23.1
9.0
9.0
a
The Group operates customer loyalty programs enabling customers to accumulate award credits for gaming and on-property spend. A
portion of the spend, equal to the fair value of the award credits earned, is treated as deferred revenue, and recognised in the income
statement when the award is redeemed or expires.
F7 SHARE CAPITAL AND RESERVES
(i) SHARE CAPITAL
There is only one class of shares (ordinary shares) on issue. These ordinary shares entitle the holder to participate in
dividends and proceeds on winding up of the Company, in proportion to the number and amounts paid on the shares held.
On a show of hands, every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and
upon a poll each share is entitled to one vote. The Company does not have authorised capital nor par value in respect of its
issued shares
Opening balance 1 July 2022
Issue of share capital (net of tax) - 7 March 2023 a
Issue of share capital (net of tax) - 20 March 2023 b
Shares purchased
programs
future employee share
for
Shares issued to settle employee share programs
SShhaarree
ccaappiittaall
TTrreeaassuurryy
sshhaarreess
NNeett
oouuttssttaannddiinngg
SShhaarreess
$$mm
SShhaarreess
$$mm
SShhaarreess
$$mm
952,014,210
3,177.9
(1,895,443)
(6.9)
950,118,767
3,171.0
430,774,501
235,892,166
507.2
277.8
-
-
-
-
430,774,501
235,892,166
-
-
-
-
(2,255,061)
1,665,472
(6.4)
6.0
(2,255,061)
1,665,472
507.2
277.8
(6.4)
6.0
CClloossiinngg bbaallaannccee 3300 JJuunnee 22002233
11,,661188,,668800,,887777
33,,996622..99
((22,,448855,,003322))
((77..33)) 11,,661166,,119955,,884455
33,,995555..66
Opening balance 1 July 2021
952,014,210
3,177.9
(5,525,183)
(18.6)
946,489,027
3,159.3
Shares purchased
programs
for
future employee share
Shares issued to settle employee share programs
-
-
-
-
(464,958)
4,094,698
(1.9)
13.6
(464,958)
4,094,698
(1.9)
13.6
Closing balance 30 June 2022
3,171.0
a On 7 March 2023, the Group issued 430,774,501 new shares for private placement to institutional investors under the accelerated non-
renounceable entitlement offer. The capital raising is after $9.7 million of costs, net of tax.
b On 20 March 2023, the Group issued 235,892,166 new shares for retail component of the accelerated non-renounceable entitlement
offer (including shares issued to Chow Tai Fook Enterprises Limited and Far East Consortium International Limited under the placement and
institutional entitlement offer, in accordance with the retail entitlement offer timetable). The capital raising is after $5.3 million of costs, net
of tax.
952,014,210
950,118,767
(1,895,443)
3,177.9
(6.9)
92
134
92
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
(ii) RESERVES (NET OF TAX)
Hedging reserve a
Cost of hedging reserve b
Share based payments reserve c
22002233
$$mm
((88..22))
22..44
88..66
22..88
22002222
$$mm
(1.7)
2.6
10.6
11.5
NNaattuurree aanndd ppuurrppoossee ooff rreesseerrvveess
a
b
c
The hedging reserve records the spot element of fair value changes on the portion of the gain or loss on a hedging
instrument in a cash flow hedge that is determined to be an effective hedge.
The spot element of derivative contracts are designated as hedging instruments with fair value changes recorded in the
hedging reserve. The forward element is recognised in other comprehensive income and accumulated in a separate
component of equity under costs of hedging reserve.
The share based payments reserve is used to recognise the value of equity settled share based payment transactions
provided to employees, including Key Management Personnel as part of their remuneration. Refer to note F9 for further
details on these plans.
(iii) CAPITAL MANAGEMENT
The Group's objectives when managing capital are to ensure the Group continues as a going concern while providing optimal
returns to shareholders and benefits for other stakeholders, and to maintain an optimal capital structure to reduce the cost
of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends to be paid to shareholders,
return capital to shareholders or issue new shares. Gearing is managed primarily through the ratio of net debt to earnings
before interest, tax, depreciation, amortisation, impairment, significant items and share of the net loss of associate and joint
venture entities.
Net debt comprises interest bearing liabilities, with US dollar borrowings translated at the 30 June 2023 USD/AUD spot rate
of 1.5090 (2022: 1.4518), after adjusting for cash and cash equivalents and derivative financial instruments.
The Group’s capital management also aims to ensure that it meets financial covenants attached to the interest bearing loans
and borrowings that define capital structure requirements. There have been no breaches of the financial covenants of any
interest bearing loans and borrowings in the current period. The Group obtained an amendment for the 30 June 2023 testing
date from certain lenders, allowing for some cash significant items to be added back to earnings to enable compliance with
the interest cover covenant.
Gross Debt
Net Debt a
EBITDA (before significant items) b
Gearing ratio (times)
22002233
$$mm
775577..22
559955..55
331177..44
11..99
xx
22002222
$$mm
1,332.5
1,149.0
413.6
x2.8
a
b
Net debt is shown as interest bearing liabilities (excluding lease liabilities), less cash and cash equivalents, less net
position of derivative financial instruments.
EBITDA (before significant items) is a non-IFRS disclosure and stands for earnings before interest, tax, depreciation,
amortisation, impairment, significant items and share of profits / losses from joint ventures. For FY22, EBITDA (before
significant items) was calculated on an annualised 2H FY22 run rate, as agreed with the financiers.
93
93
135
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
F8 RECONCILIATION OF NET PROFIT AFTER TAX TO NET CASH INFLOWS FROM OPERATIONS
Net loss after tax
- Depreciation, amortisation and impairment
- Employee share based payments expense / (benefit)
- Gain on disposal of property, plant and equipment
- Finance costs
- Share of net profit of associate and joint venture entities
- Gain on disposal of aircraft
Working capital changes
- Increase in trade and other receivables and other assets
- Decrease/(increase) in inventories
- Increase in trade and other payables, accruals and provisions
- Decrease in tax provisions
NNoottee
A4
F9
A5
D5
22002233
$$mm
((22,,443355..22))
22,,334488..44
22..66
((00..88))
111100..88
((55..44))
--
((1100..77))
11..33
338800..77
((334477..99))
22002222
$$mm
(202.5)
370.8
(0.8)
(0.9)
57.0
(16.4)
(10.1)
(49.4)
(1.0)
36.5
(7.0)
NNeett ccaasshh iinnffllooww ffrroomm ooppeerraattiinngg aaccttiivviittiieess
176.2
OOppeerraattiinngg ccaasshh ffllooww bbeeffoorree iinntteerreesstt aanndd ttaaxx wwaass $$6633..00 mmiilllliioonn,, ddoowwnn 6655..33%% oonn tthhee ppccpp.. TThhee EEBBIITTDDAA ttoo ccaasshh ccoonnvveerrssiioonn
rraattiioo wwaass ((2233%%)).. AAddjjuussttiinngg ffoorr mmaatteerriiaall uunnppaaiidd rreegguullaattoorryy aanndd lleeggaall ccoossttss,, ccaasshh ccoolllleeccttiioonn rraattiioo iiss 5522%%..
4433..88
94
136
94
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
F9 EMPLOYEE SHARE PLANS
LLoonngg tteerrmm iinncceennttiivvee ppllaann
During the current and prior periods, the Company issued Performance Rights under the long term incentive plan to eligible
employees. The share based payment credit of $0.3 million (2022: credit of $3.0 million) in respect of the equity instruments
granted is recognised in the income statement.
The number of Performance Rights granted to employees and forfeited or lapsed during the year are set out below.
22002233
BBaallaannccee aatt ssttaarrtt ooff
yyeeaarr
GGrraanntteedd dduurriinngg tthhee
yyeeaarr
FFoorrffeeiitteedd dduurriinngg
tthhee yyeeaarr
LLaappsseedd dduurriinngg
tthhee yyeeaarr a
VVeesstteedd dduurriinngg
tthhee yyeeaarr
BBaallaannccee aatt eenndd
ooff yyeeaarr
GGrraanntt DDaattee
33 OOccttoobbeerr 22001188
2255 SSeepptteemmbbeerr 22001199
2244 SSeepptteemmbbeerr 22002200
2233 SSeepptteemmbbeerr 22002211
2266 SSeepptteemmbbeerr 22002222
2022
Grant Date
2 October 2017
3 October 2018
25 September 2019
24 September 2020
23 September 2021
444499,,665566
661111,,550044
11,,110011,,226655
998811,,550055
--
--
--
558800,,338833
--
22,,118877,,449922
3344,,005500
441155,,660066
228888,,668833
445500,,228844
334411,,225533
334455,,336666
--
--
--
--
33,,114433,,993300
22,,776677,,887755
11,,445599,,663366
441155,,660066
--
--
--
--
--
--
--
332222,,882211
665500,,998811
11,,222200,,663355
11,,884422,,112266
44,,003366,,556633
Balance at start of
year
Granted during the
year
Forfeited during
the year b
Lapsed during
the year
Vested during
the year
Balance at end
of year
1,436,841
1,432,040
1,762,404
2,728,230
-
-
-
-
-
2,213,247
-
982,384
1,150,900
1,626,965
1,231,742
1,436,841
-
-
-
-
7,359,515
2,213,247
4,991,991
1,436,841
-
-
-
-
-
-
-
449,656
611,504
1,101,265
981,505
3,143,930
Grants include a market based hurdle (relative total shareholder return (rrTTSSRR)) and an earnings per share (EEPPSS) component.
Grants from 2 October 2017 include a market based hurdle (rTSR), an EPS component and a return on investment capital
(RROOIICC) component. The Performance Rights have been independently valued. For the rTSR component, valuation was based
on assumptions underlying the Black-Scholes methodology to produce a Monte-Carlo simulation model. For the EPS and
ROIC component, a discounted cash flow technique was utilised. The total value does not contain any specific discount for
forfeiture if the employee leaves the Group during the vesting period. This adjustment, if required, is based on the number of
equity instruments expected to vest at the end of each reporting period.
a
b
Performance rights granted on 3 October 2018 were tested on 3 October 2022 and did not vest. The TSR percentile rank for the
Company was 15.39%, below the 50th percentile rank. The EPS was (21.1)c, below the 27.6c threshold. The ROIC was (3.2)%, below
the 8.8% threshold. As a result, these Performance Rights lapsed and no shares were issued to participants.
The number of performance rights granted on 2 October 2017 were tested on 28 October 2021 and did not vest. The TSR percentile
rank for the Company was 21.54%, below the 50th percentile rank. The EPS was 6.4c, below the 35.9c threshold. The ROIC was 1.3%,
below the 9.5% threshold. As a result, these Performance Rights lapsed and no shares were issued to participants.
The key assumptions underlying the Performance Rights valuations are set out below:
SShhaarree pprriiccee aatt
ddaattee ooff ggrraanntt
EExxppeecctteedd
vvoollaattiilliittyy iinn
sshhaarree pprriiccee
EExxppeecctteedd
ddiivviiddeenndd yyiieelldd
RRiisskk ffrreeee
iinntteerreesstt rraattee
AAvveerraaggee FFaaiirr
VVaalluuee ppeerr
PPeerrffoorrmmaannccee
RRiigghhtt
EEffffeeccttiivvee ggrraanntt ddaattee
TTeesstt aanndd vveessttiinngg ddaattee
3 October 2018
25 September 2019
24 September 2020
23 September 2021
26 September 2022
3 October 2022
25 September 2023
24 September 2024
23 September 2025
26 September 2026
$$
5.21
4.20
3.15
4.35
2.63
%%
%
%
%
%
%
22.76
22.00
29.00
31.00
32.00
%%
4.66
%
%-
%-
%-
%-
%%
%
%
%
%
%
2.14
0.72
0.26
0.41
3.80
$$
3.77
3.66
2.76
3.78
2.33
95
95
137
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
EEqquuiittyy rreetteennttiioonn ppllaann
Since FY19, the Company has granted restricted shares under the equity retention plan to eligible employees. The share
based payment expense of $2.7 million (2022: $0.7 million) in respect of the equity instruments granted is recognised in the
income statement. The number of restricted shares granted to employees and forfeited during the year are set out below.
22002233
GGrraanntt DDaattee
11 JJuullyy 22002222
22002222
GGrraanntt DDaattee
1 July 2021
BBaallaannccee aatt ssttaarrtt
ooff yyeeaarr
GGrraanntteedd dduurriinngg
tthhee yyeeaarr
FFoorrffeeiitteedd
dduurriinngg tthhee
yyeeaarr
LLaappsseedd
dduurriinngg tthhee
yyeeaarr
VVeesstteedd dduurriinngg
tthhee yyeeaarr
BBaallaannccee aatt eenndd ooff
yyeeaarr
11,,114499,,663399
11,,663399,,664422
331122,,330066
--
11,,227700,,008866
11,,220066,,888899
BBaallaannccee aatt ssttaarrtt
ooff yyeeaarr
GGrraanntteedd dduurriinngg
tthhee yyeeaarr
FFoorrffeeiitteedd
dduurriinngg tthhee
yyeeaarr
LLaappsseedd
dduurriinngg tthhee
yyeeaarr
VVeesstteedd dduurriinngg
tthhee yyeeaarr
BBaallaannccee aatt eenndd ooff
yyeeaarr
1,189,159
219,337
258,857
-
-
1,149,639
The awards are granted at no cost to participants and are subject to a service condition of five years. Participants are entitled
to dividends and may benefit from share price growth over the vesting period.
SShhoorrtt tteerrmm iinncceennttiivvee ppllaann
On 19 April 2023, the Group announced the cancellation of the FY23 short term incentive plan.
The Board approved the award of the FY22 short term incentive plan. Certain executives receive one third of their eligible
award as shares, subject to a holding lock of one year from the date of issue.
The share based payment expense of $0.2 million (2022: $1.5 million) in respect of the short term incentives has been
recognised in the income statement.
F10 AUDITOR'S REMUNERATION
Fees to Ernst & Young (Australia):
Fees for auditing the statutory financial report of the parent and consolidated
group
Fees for other assurance and agreed-upon-procedures services (including
sustainability assurance) under contractual arrangements where there is
discretion as to whether the service is provided by the auditor
Fees for other advisory and compliance services
TToottaall ffeeeess ttoo EErrnnsstt && YYoouunngg AAuussttrraalliiaa
22002233
$$
22002222
$$
22,,227799,,558888
1,209,128
119977,,660000
5588,,000000
77,025
55,500
22,,553355,,118888
1,341,653
The auditor of the Company and its controlled entities is Ernst & Young. From time to time, Ernst & Young provides other
services to the Group, which are subject to strict corporate governance procedures encompassing the selection of service
providers and the setting of their remuneration. The Chair of the Audit Committee (or authorised delegate) must approve any
other services provided by Ernst & Young to the Group. The Company's Group Chief Financial Officer has limited delegated
authority for the pre-approval of audit and non-audit services proposed by the external auditors, limited to $50,000 per
engagement and capped at 40% of the relevant year's audit fee.
The financial year ended 30 June 2023 is Scott Jarrett's first year as Lead Audit Partner, following rotation of the previous
audit partner in accordance with section 92 of the Corporations Act 2001 (Cth).
96
138
96
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
G
ACCOUNTING POLICIES AND CORPORATE INFORMATION
Significant accounting policies are contained within the financial statement notes to which they relate and are not detailed in
this section.
CORPORATE INFORMATION
The Star Entertainment Group Limited (the CCoommppaannyy) is a company incorporated and domiciled in Australia. The Financial
Report of the Company for the year ended 30 June 2023 comprises the Company and its controlled entities (collectively
referred to as the GGrroouupp). The Company's registered office is Level 3, 159 William Street, Brisbane QLD 4000.
The Company is of the kind specified in Australian Securities and Investments Commission (ASIC) Instrument 2016/191. In
accordance with that Instrument, amounts in the Financial Report and the Directors Report have been rounded to the
nearest hundred thousand dollars, unless specifically stated to be otherwise. All amounts are in Australian dollars ($). The
Company is a for profit organisation.
The Financial Report was authorised for issue by the Directors on 29 August 2023.
BASIS OF PREPARATION
The Financial Report is a general purpose Financial Report which has been prepared in accordance with the Corporations Act
2001, Australian Accounting Standards and other mandatory Financial Reporting requirements in Australia. The financial
statements comply with International Financial Reporting Standards (IIFFRRSS) as issued by the International Accounting
Standards Board.
The financial statements have been prepared under the historical cost convention except as disclosed in the accounting
policies below and elsewhere in this report. The policies used in preparing the financial statements are consistent with those
of the previous year except as indicated under 'Changes in accounting policies and disclosures'.
GOING CONCERN
The implementation of uplifted controls, which necessarily resulted in increased exclusions; the important uplifting of risk
and compliance resourcing; the introduction of competition during the period in the Sydney table games market; some
operating restrictions impacting customer experience; and weaker consumer discretionary spending have all impacted
operating performance. This change in operating conditions together with matters detailed in note B7 leads to significant
uncertainty facing the Group, predominately from:
the indefinite suspension of the Sydney Casino licence (from 21 October 2022);
the deferred suspension of the Queensland Casino licences (from 1 December 2023 for a period of at least 90 days);
the appointment of a Manager / Special Manager to manage (in NSW) and monitor (in Queensland) the casino
operations;
amendments to the Casino Control Acts in both NSW and Queensland to introduce more stringent compliance
requirements;
the ongoing AUSTRAC civil penalty proceedings; and
four outstanding class actions.
In order to secure the financial flexibility to meet anticipated cashflow requirements and navigate a range of operating and
regulatory uncertainties, the Company completed an $800 million capital raise in March 2023. Proceeds from this capital
raise were used to repay debt and contribute towards the payment of NICC and OLGR fines. The deterioration of operating
performance (described above) has accelerated the Group’s refinancing project expected to be completed in 1H FY24.
In the Directors' opinion, whilst the outcome of matters outlined in note B7 creates material uncertainty as to the Group's
ability to remain a going concern, the Group is likely to be able to meet its liabilities as and when they fall due over the next
twelve months and continues to remain a going concern, provided:
the outcomes of the uncertainties outlined in note B7 as a whole are not sufficiently onerous as to prevent the Company
from settling its obligations;
the Group remains in contact with its lenders and would seek additional waivers and amendments, if required;
the Group is able to execute its refinancing plan; and
the Group, by continuing to work with the Manager and Special Manager, is able to develop and implement on its longer
term remediation measures and restore the Group to suitability to hold its casino licences.
The financial report does not include any adjustments relating to the recoverability and classification of recorded asset
amounts or to the amounts and classification of liabilities that might be necessary should the entity not continue as a going
concern.
97
97
139
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS
Preparation of the financial statements in conformity with Australian Accounting Standards and IFRS requires management
to make judgements, estimates and assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period.
In the process of applying the Group's accounting policies, management has made the following judgements, which have the
most significant effect on the amounts recognised in the consolidated financial statements:
Going concern (refer note above);
Asset useful lives and residual values (refer notes A4 and B5);
Impairment of assets (refer note B6);
Valuation of derivatives and other financial instruments and hedge accounting (refer note B3);
Impairment of trade receivables (refer note B2);
Significant items (refer note A7); and
Provisions and contingent liabilities (refer note B7).
Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the
carrying amount of the asset or liability in future periods.
TTiittllee
Amendments to AASB 3 Business Combinations
Amendments to AASB 116 Property, Plant and Equipment - Proceeds before Intended Use
Amendments to AASB 137 Provisions, Contingent Liabilities & Contingent Assets
CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES
The Group has adopted the following new and amended accounting standards, which became applicable for the year ended
30 June 2023:
RReeffeerreennccee
AASB 3
AASB 116
AASB 137
AAmmeennddmmeennttss ttoo AAAASSBB 33 aanndd AAAASSBB 113377 -- RReeffeerreennccee ttoo tthhee CCoonncceeppttuuaall FFrraammeewwoorrkk
The amendments replace a reference to a previous version of the IASB’s Conceptual Framework with a reference to the
current version issued in March 2018 without significantly changing its requirements.
The amendments add an exception to the recognition principle of AASB 3 Business Combinations to avoid the issue of
potential ‘day 2’ gains or losses arising for liabilities and contingent liabilities that would be within the scope of AASB 137
Provisions, Contingent Liabilities and Contingent Assets, if incurred separately. The exception requires entities to apply the
criteria in AASB 137, respectively, instead of the Conceptual Framework, to determine whether a present obligation exists at
the acquisition date.
The amendments also add a new paragraph to AASB 3 to clarify that contingent assets do not qualify for recognition at the
acquisition date.
These amendments had no impact on the consolidated financial statements of the Group as there were no contingent
assets, liabilities and contingent liabilities within the scope of these amendments arisen during the period.
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The amendment prohibits entities from deducting from the cost of an item of property, plant and equipment, any proceeds of
the sale of items produced while bringing that asset to the location and condition necessary for it to be capable of operating
in the manner intended by management. Instead, an entity recognises the proceeds from selling such items, and the costs of
producing those items, in profit or loss.
These amendments had no impact on the consolidated financial statements of the Group as there were no sales of such
items produced by property, plant and equipment made available for use on or after the beginning of the earliest period
presented.
98
140
98
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
STANDARDS AND AMENDMENTS ISSUED BUT NOT YET EFFECTIVE
The Group has not applied Australian Accounting Standards and IFRS that were issued or amended but not yet effective. The
key standards, shown below, are not expected to have a material impact on the financial statements:
RReeffeerreennccee
AASB 2020-1 Amendments to Australian Accounting Standards - Classification of Liabilities as
AApppplliiccaattiioonn ddaattee
1 January 2023
TTiittllee
Current or Non-current
AASB 2015-2 Amendments to Australian Accounting Standards - Disclosure of Accounting
1 January 2023
Policies and Definition of Accounting Estimates
AASB 2021-5 Amendments to Australian Accounting Standards - Deferred Tax related to Assets
1 January 2023
and Liabilities arising from a Single Transaction
BASIS OF CONSOLIDATION
CCoonnttrroolllleedd eennttiittiieess
The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity
and has the ability to affect those returns through its power over the entity. Controlled entities are consolidated from the date
control is transferred to the Group and are no longer consolidated from the date control ceases. Intercompany transactions,
balances and unrealised gains on transactions between Group companies are eliminated.
FFoorreeiiggnn ccuurrrreennccyy
The consolidated financial statements are presented in Australian dollars ($) which is the Group's functional and
presentation currency.
TTrraannssaaccttiioonnss aanndd bbaallaanncceess
Transactions denominated in foreign currencies are translated at the rate of exchange ruling on the transaction date.
Monetary items denominated in foreign currencies are translated at the rate of exchange ruling at the end of the reporting
period. Gains and losses arising from the translation are credited or charged to the income statement, with the exception of
differences on foreign currency borrowings that are in an effective hedge relationship. These are taken directly to equity until
the liability is extinguished, at which time they are recognised in the income statement.
GOVERNMENT GRANTS
Government grants are recognised where there is reasonable assurance that the grant will be received, and all attached
conditions will be complied with. When the grant relates to an expense, it is recognised net of the related expense for which it
is intended to compensate. There are no unfilled conditions or other contingencies attached to the grants.
NET FINANCE COSTS
Finance income is recognised as the interest accrues, using the effective interest method. Finance costs consist of interest
and other borrowing costs incurred in connection with the borrowing of funds. Finance costs directly associated with
qualifying assets are capitalised, all other finance costs are expensed, in the period in which they occur.
TAXATION
IInnccoommee ttaaxx
Income tax comprises current and deferred income tax. Income tax is recognised in the income statement except to the
extent that it relates to items recognised directly in equity, in which case it is recognised in equity. Current tax is the expected
tax payable on the taxable income for the period, and any adjustment to tax payable in respect of previous years.
Deferred tax is provided using the balance sheet method, providing for temporary differences between the carrying amounts
of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary
differences are not provided for:
goodwill; and
the initial recognition of an asset or liability in a transaction which is not a business combination and that affect neither
accounting nor taxable profit at the time of the transaction.
The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of
assets and liabilities. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be
available against which the asset can be utilised.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same
taxation authority.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the
asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted
at the reporting date.
99
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
GOODS AND SERVICES TAX (GST)
Revenues, expenses, assets and liabilities are recognised net of the amount of GST except:
when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case
the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable;
casino revenues, due to the GST being offset against government taxes; and
receivables and payables, which are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables
in the balance sheet.
Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from
investing and financing activities, which is recoverable from, or payable to, the taxation authority is classified as operating
cash flows.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents are carried in the balance sheet at face value. Cash and cash equivalents include cash balances
and call deposits with an original maturity of three months or less. Bank overdrafts that are repayable on demand and form
an integral part of the Group's cash management are included as a component of cash for the purpose of the statement of
cash flows.
TRADE AND OTHER RECEIVABLES
Trade receivables are recognised and carried at original settlement amount less a provision for expected credit loss impaired,
where applicable. Bad debts are written off when they are known to be uncollectible. Subsequent recoveries of amounts
previously written off are credited to the income statement. Other receivables are carried at amortised cost less impairment.
INVENTORIES
Inventories include consumable stores, food and beverage and are carried at the lower of cost and net realisable value.
Inventories are costed on a weighted average basis. Net realisable value is the estimated selling price in the ordinary course
of business.
PROPERTY, PLANT AND EQUIPMENT
Refer to notes A4 and B4 for further details of the accounting policy, including useful lives of property, plant and equipment.
Freehold land is included at cost and is not depreciated.
All other items of property, plant and equipment are stated at historical cost net of depreciation, amortisation and
impairment, and depreciated over periods deemed appropriate to reduce carrying values to estimated residual values over
their useful lives. Historical cost includes expenditure that is directly attributable to the acquisition of these items.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in
the income statement.
When the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its
recoverable amount.
Costs arising subsequent to the acquisition of an asset are included in the asset's carrying amount or recognised as a
separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to
the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are charged to the
income statement during the financial year in which they are incurred.
Costs relating to development projects are recognised as an asset when it is:
probable that any future economic benefit associated with the item will flow to the entity; and
it can be measured reliably.
If it becomes apparent that the development will not occur, the amount is expensed to the income statement.
100
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100
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
INTANGIBLE ASSETS
GGooooddwwiillll
Goodwill represents the excess of the consideration transferred over the fair value of the identifiable net assets acquired and
liabilities assumed. Goodwill is assessed for impairment on an annual basis and is carried at cost less accumulated
impairment losses. Impairment losses on goodwill are not reversed.
Goodwill is allocated to cash generating units for the purpose of impairment testing. The allocation is made to those cash
generating units or groups of cash generating units that are expected to benefit from the business combination in which the
goodwill arose.
OOtthheerr iinnttaannggiibbllee aasssseettss
Indefinite life intangible assets are not amortised and are assessed annually for impairment. Expenditure on gaming licences
acquired, casino concessions acquired, computer software and other intangibles are capitalised and amortised using the
straight line method as described in note B5.
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Costs associated with developing or maintaining computer software programs are recognised as expenses as incurred.
However, costs that are directly associated with identifiable and unique software products controlled by the Group and which
have probable economic benefits exceeding the costs beyond one year are recognised as intangible assets. Direct costs
include staff costs of the software development team and an appropriate portion of the relevant overheads. Expenditure
meeting the definition of an asset is recognised as a capital improvement and added to the original cost of the asset. These
costs are amortised using the straight line method, as described in note B5.
CCaassiinnoo lliicceenncceess aanndd ccoonncceessssiioonnss
Refer to note B5 for details and accounting policy.
IMPAIRMENT OF ASSETS
Assets that have an indefinite useful life are not subject to depreciation or amortisation and are tested annually for
impairment. Assets that are subject to depreciation or amortisation are reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount
by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair
value less costs of disposal and value in use. For the purpose of assessing impairment, assets are grouped at the lowest
level for which there are separately identifiable cash flows (cash generating units). Refer to note B6 for further details of key
assumptions included in the impairment calculation.
PROVISIONS
A provision is recognised in the balance sheet when the Group has a present legal or constructive obligation as a result of a
past event, and it is probable that an outflow of economic benefits will be required to settle the obligation and the amount
can be reliably estimated. If the effect is material, provisions are determined by discounting the expected future cash flows at
a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific
to the liability.
INVESTMENT IN ASSOCIATE AND JOINT VENTURE ENTITIES
Associates are all entities over which the Group has significant influence but not control or joint control. Joint control is the
contractually agreed sharing of the joint arrangement, which exists only when decisions about the relevant activities require
unanimous consent of the parties sharing control. A joint venture is a type of arrangement whereby the parties that have joint
control of the arrangement have rights to the net assets of the joint venture. The Group's investments in associate and joint
venture entities are accounted for using the equity method of accounting, after initially being recognised at cost. Under the
equity method of accounting, the investments are initially recognised at cost and are subsequently adjusted to recognise the
Group's share of the post-acquisition profits or losses of the investee in the income statement, and the Group's share of
movements in other comprehensive income of the investee in other comprehensive income. Distributions received are
recognised as a reduction in the carrying amount of the investment. The carrying amount of equity-accounted investments is
tested for impairment in accordance with the Group's policy.
INTEREST BEARING LIABILITIES
Interest bearing liabilities are recognised initially at fair value and include transaction costs. Subsequent to initial recognition,
interest bearing liabilities are recognised at amortised cost using the effective interest rate method. Any difference between
proceeds and the redemption value is recognised in the income statement over the period of the borrowing using the
effective interest rate method.
Interest bearing liabilities are classified as current liabilities unless the Group has an unconditional right to defer settlement
of the liability for at least 12 months after the balance sheet date.
101
101
143
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
LEASES
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The Group recognises right-of-use (RROOUU) at the commencement date of the lease (i.e. the date the underlying asset is
available for use). ROU assets are measured at cost, less any accumulated depreciation and impairment losses, and
adjusted for any remeasurement of lease liabilities. The cost of ROU assets includes the amount of lease liabilities
recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease
incentives received. The recognised ROU assets are depreciated on a straight-line basis over the shorter of its estimated
useful life and the lease term. ROU assets are subject to impairment.
LLeeaassee lliiaabbiilliittiieess
At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease
payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed
payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase
option reasonably certain to be exercised by the Group and payments of penalties for terminating a lease, if the lease term
reflects the Group exercising the option to terminate. The variable lease payments that do not depend on an index or a rate
are recognised as expense in the period on which the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the lease
commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the
amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In
addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a
change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset.
Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to its short-term leases of buildings, leasehold improvements
and plant and equipment. (i.e., those leases that have a lease term of 12 months or less from the commencement date and
do not contain a purchase option). It also applies the lease of low-value assets recognition exemption to leases of office
equipment that are considered of low value (i.e. below $10,000). Lease payments on short-term leases and leases of low-
value assets are recognised as expense on a straight-line basis over the lease term.
Leases of assets under which substantially all the risks and benefits of ownership are effectively retained by the lessor are
classified as operating leases. Payments made under operating leases are charged to the income statement on a straight-
line basis over the period of the lease.
EMPLOYEE BENEFITS
PPoosstt--eemmppllooyymmeenntt bbeenneeffiittss
The Group's commitment to defined contribution plans is limited to making the contributions in accordance with the
minimum statutory requirements. There is no legal or constructive obligation to pay further contributions if the fund does not
hold sufficient assets to pay all employees relating to current and past employee services.
Superannuation guarantee charges are recognised as expenses in the income statement as the contributions become
payable. A liability is recognised when the Group is required to make future payments as a result of employees' services
provided.
LLoonngg sseerrvviiccee lleeaavvee
The Group's net obligation in respect of long term service benefits, other than pension plans, is the amount of future benefit
that employees have earned in return for their service in the current and prior periods. The obligation is calculated using the
expected future increases in wage and salary rates including related on-costs and expected settlement dates, and is
discounted using rates attached to bonds with sufficiently long maturities at the balance sheet date, which have maturity
dates approximating to the terms of the Group's obligations.
AAnnnnuuaall lleeaavvee
Liabilities for annual leave are calculated at discounted amounts based on remuneration rates the Group expects to pay,
including related on-costs when the liability is expected to be settled. Annual leave is another long term benefit and is
measured using the projected credit unit method.
SShhaarree bbaasseedd ppaayymmeenntt ttrraannssaaccttiioonnss
The Company operates a long term incentive plan (LLTTII), which is available to employees at the most senior executive levels.
Under the LTI, employees may become entitled to Performance Rights which may potentially convert to ordinary shares in the
Company. The fair value of Performance Rights is measured at grant date and is recognised as an employee expense (with a
corresponding increase in the share based payment reserve) over four years from the grant date irrespective of whether the
Performance Rights vest to the holder. A reversal of the expense is only recognised in the event the instruments lapse due to
cessation of employment within the vesting period.
The fair value of the Performance Rights is determined by an external valuer and takes into account the terms and conditions
upon which the Performance Rights were granted.
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102
144
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
The Company operates an Equity Retention Plan, whereby eligible employees may receive up to 100% of their fixed annual
remuneration amount in value as fully paid ordinary shares after five years. The awards are issued at no cost to participants
and are subject to a service condition of five years. Participants are entitled to dividends and may benefit from share price
growth over the vesting period.
Under the Company's short term incentive plan (SSTTII), eligible employees receive two thirds of their annual STI entitlement in
cash and one third in the form of restricted shares which are subject to a holding lock for a period of twelve months. These
shares are forfeited in the event that the employee voluntarily terminates from the Company. Due to the exceptional
circumstances associated with COVID-19, the Board resolved to exercise its discretion to make a significantly reduced equity
award under the FY20 STI. The award was delivered as a share based payment, subject to a holding lock of one year from
the date of issue.
The cost is recognised in employment costs, together with a corresponding increase in equity (share based payment reserve)
over the service period. No expense is recognised for awards that do not ultimately vest. A liability is recognised for the fair
value of cash settled transactions. The fair value is measured initially and at each reporting date up to and including the
settlement date, with changes in fair value recognised in employment costs.
DERIVATIVE FINANCIAL INSTRUMENTS
The Group uses derivative financial instruments to hedge its exposure to foreign exchange and interest rate risks arising
from operational, financing and investment activities. In accordance with its Treasury Policy, the Group does not hold or issue
derivative financial instruments for trading purposes. However, derivatives that do not qualify for hedge accounting are
accounted for as trading instruments.
Derivative financial instruments are recognised initially at fair value at the date the derivative contract is entered into and are
subsequently remeasured to fair value at the end of each reporting period. The resulting gain or loss is recognised
immediately in the income statement. However, where derivatives qualify for cash flow hedge accounting, the effective
portion of the gain or loss is deferred in equity while the ineffective portion is recognised in the income statement.
The fair value of interest rate swap, cross currency swap and forward currency contracts is determined by reference to
market values for similar instruments. Refer to note E2 for details of fair value determination.
Derivative assets and liabilities are offset and the net amount reported in the consolidated balance sheet if, and only if:
there is a currently enforceable legal right to offset the recognised amount; and
there is an intention to settle on a net basis, or to realise the assets and settle the liabilities simultaneously.
HEDGING
CCaasshh ffllooww hheeddggeess
Where a derivative financial instrument is designated as a hedge of the exposure to variability in cash flows that are
attributable to a particular risk associated with a recognised asset or liability, or a highly probable forecast transaction, the
effective part of any gain or loss on the derivative financial instrument is recognised directly in equity. When the forecast
transaction subsequently results in the recognition of a non financial asset or liability, the associated cumulative gain or loss
is removed from equity and included in the initial cost or other carrying amount of the non financial asset or liability.
If a hedge of a forecast transaction subsequently results in the recognition of a financial asset or financial liability, then the
associated gains and losses that were recognised directly in equity are reclassified into the income statement in the same
period or periods during which the asset acquired or liability assumed affects the income statement (i.e. when interest
income or expense is recognised). For cash flow hedges, the effective part of any gain or loss on the derivative financial
instrument is removed from equity and recognised in the income statement in the same period or periods during which the
hedged forecast transaction affects the income statement. The ineffective part of any gain or loss is recognised immediately
in the income statement.
When a hedging instrument expires or is sold, terminated or exercised, or the designation of the hedge relationship is
revoked but the hedged forecast transaction is still expected to occur, the cumulative gain or loss at that point remains in
equity and is recognised in accordance with the above when the transaction occurs. If the hedged transaction is no longer
expected to take place, then the cumulative unrealised gain or loss recognised in equity is recognised immediately in the
income statement.
FFaaiirr vvaalluuee hheeddggeess
Where a derivative financial instrument is designated as a hedge of the exposure to variability in the fair value of a
recognised asset or liability, any change in the fair value of the hedge is recognised in the income statement as a finance
cost. The change in the fair value of the hedged item attributable to the risk hedged is recorded as part of the carrying value
of the hedged item and is also recognised in the income statement as a finance cost.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
ISSUED CAPITAL
Issued and paid up capital is recognised at the fair value of the consideration received. Issued capital comprises ordinary
shares. Any transaction costs directly attributable to the issue of ordinary shares are recognised directly in equity, net of tax,
as a reduction of the share proceeds received.
OPERATING SEGMENT
An operating segment is a component of an entity that engages in business activities from which it may earn revenues and
incur expenses (including revenues and expenses relating to transactions with other components of the same entity), whose
operating results are regularly reviewed by the entity's executive decision makers to allocate resources and assess its
performance.
The Group aggregates two or more operating segments when they have similar economic characteristics, and the segments
are similar in each of the following respects:
nature of the products and services;
type or class of customer for the products and services;
methods used to distribute the products or provide the services; and
nature of the regulatory environment.
Segment results include revenue and expenses directly attributable to a segment and exclude significant items.
Capital expenditure represents the total costs incurred during the period to acquire segment assets, including capitalised
interest.
DIVIDEND DISTRIBUTIONS
Dividend distributions to the Company's shareholders are recognised as a liability in the Group's financial statements in the
period in which the dividends are declared.
BASIC EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the net earnings after tax for the period by the weighted average number of
ordinary shares outstanding during the period.
DILUTED EARNINGS PER SHARE
Diluted earnings per share is calculated by dividing the net earnings attributable to ordinary equity holders adjusted by the
after tax effect of:
any dividends or other items related to dilutive potential ordinary shares deducted in arriving at profit or loss attributable
to ordinary equity holders;
any interest recognised in the period related to dilutive potential ordinary shares; and
any other changes in income or expense that would result from the conversion of the dilutive potential ordinary shares;
by the weighted average number of issued ordinary shares plus the weighted average number of ordinary shares that would
be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares.
ASSETS HELD FOR SALE
Non-current assets are classified as held for sale if their carrying amounts will be recovered principally through a sale
transaction, rather than through continuing use, and a sale is considered highly probable. They are measured at the lower of
their carrying value and fair value less costs to sell. An impairment loss is recognised for the amount by which the asset’s
carrying amount exceeds its fair value less costs to sell.
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104
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT DIRECTORS' DECLARATION
In the opinion of the Directors of The Star Entertainment Group Limited (the Company):
(a)
the financial statements and notes of the Group are in accordance with the Corporations Act 2001, including:
(i)
giving a true and fair view of the Group's consolidated financial position as at 30 June 2023 and of its performance for
the year ended on that date; and
(ii)
complying with the Accounting Standards and the Corporations Regulations 2001;
(b)
the Financial Report also complies with International Financial Reporting Standards as disclosed in note G; and
(c)
there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and
payable.
This declaration has been made after receiving the declarations required to be made to the directors in accordance with section
295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors.
DDaavviidd FFoosstteerr
Chairman
Sydney
29 August 2023
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Ernst & Young
200 George Street
Sydney NSW 2000 Aust ralia
GPO Box 2646 Sydney NSW 2001
Ernst & Young
200 George Street
Sydney NSW 2000 Aust ralia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
Independent Audit or’s r eport t o t he Members of The St ar Ent ert ainment
Group Limit ed
Independent Audit or’s r eport t o t he Members of The St ar Ent ert ainment
Report on t he Audit of t he Financial Report
Group Limit ed
Opinion
Report on t he Audit of t he Financial Report
We have audited the financial report of The Star Entertainment Group Limited (the Company) and its
subsidiaries (collectively the Group), which comprises the consolidated balance sheet as at 30 June
Opinion
2023, the consolidated income statement, consolidated statement of changes in equity and
We have audited the financial report of The Star Entertainment Group Limited (the Company) and its
consolidated statement of cash flows for the year then ended, notes to the financial statements,
subsidiaries (collectively the Group), which comprises the consolidated balance sheet as at 30 June
including a summary of significant accounting policies, and the directors’ declaration.
2023, the consolidated income statement, consolidated statement of changes in equity and
consolidated statement of cash flows for the year then ended, notes to the financial statements,
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
including a summary of significant accounting policies, and the directors’ declaration.
Act 2001, including:
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2023
a.
Act 2001, including:
and of its consolidated financial performance for the year ended on that date; and
a.
b.
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2023
complying with Australian Accounting Standards and the Corporations Regulations 2001.
and of its consolidated financial performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis f or opinion
b.
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Basis f or opinion
Report section of our report. We are independent of the Group in accordance with the auditor
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
independence requirements of the Corporations Act 2001 and the ethical requirements of the
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Report section of our report. We are independent of the Group in accordance with the auditor
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
independence requirements of the Corporations Act 2001 and the ethical requirements of the
financial report in Australia. We have also fulfilled our ot her ethical responsibilities in accordance with
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
the Code.
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our ot her ethical responsibilities in accordance with
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
the Code.
our opinion.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
Material Uncertainties Relating to Going Concern
our opinion.
We draw attention to Note G of the financial report which outlines the Directors’ assessment of the
Material Uncertainties Relating to Going Concern
abilit y of t he Group to continue as a going concern. These matters indicate that material uncertainties
exist that may cast significant doubt on the Company’s ability to continue as a going concern. Note G
We draw attention to Note G of the financial report which outlines the Directors’ assessment of the
describes the basis for the Directors’ assessment that the Group has the ability to continue as a going
abilit y of t he Group to continue as a going concern. These matters indicate that material uncertainties
concern and the actions they are planning to take to respond to these uncertainties. Our opinion is not
exist that may cast significant doubt on the Company’s ability to continue as a going concern. Note G
modified in respect of this matter.
describes the basis for the Directors’ assessment that the Group has the ability to continue as a going
concern and the actions they are planning to take to respond to these uncertainties. Our opinion is not
modified in respect of this matter.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislat ion
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislat ion
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Emphasis of Mat t er – Regulat ory and Legal Mat t ers
Emphasis of Mat t er – Regulat ory and Legal Mat t ers
We draw attention to the regulatory and legal matters disclosed in Note B7 of the financial report. Our
opinion is not modified in respect of this matter.
We draw attention to the regulatory and legal matters disclosed in Note B7 of the financial report. Our
opinion is not modified in respect of this matter.
Key Audit Mat t ers
Key Audit Mat t ers
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a
audit of the financial report of the current year. These matters were addressed in the context of our
separate opinion on these matters. For each matter below, our description of how our audit addressed
audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a
the matter is provided in t hat context. In addition to the matter described in the Material Uncertainties
separate opinion on these matters. For each matter below, our description of how our audit addressed
Relating to Going Concern section, we have determined the matters described below to be the key audit
the matter is provided in t hat context. In addition to the matter described in the Material Uncertainties
matters to be communicated in our report.
Relating to Going Concern section, we have determined the matters described below to be the key audit
matters to be communicated in our report.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
included the performance of procedures designed to respond to our assessment of the risks of material
financial report section of our report, including in relation to these matters. Accordingly, our audit
misstatement of the financial report. The results of our audit procedures, including the procedures
included the performance of procedures designed to respond to our assessment of the risks of material
performed to address the matters below, provide the basis for our audit opinion on the accompanying
misstatement of the financial report. The results of our audit procedures, including the procedures
financial report.
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
Impairment t est ing of non-curr ent asset s
Impairment t est ing of non-curr ent asset s
Why significant
Why significant
The Group had non-current assets amounting to
$3,008.8 million at 30 June 2023. The Group
The Group had non-current assets amounting to
performs an impairment assessment on an annual
$3,008.8 million at 30 June 2023. The Group
basis for goodwill and for other non-current assets,
performs an impairment assessment on an annual
when there are indicators of impairment.
basis for goodwill and for other non-current assets,
when there are indicators of impairment.
The impairment test is performed using fair value less
cost of disposal and includes significant assumptions,
The impairment test is performed using fair value less
judgements and estimates that are affected by
cost of disposal and includes significant assumptions,
expected future performance and market conditions
judgements and estimates that are affected by
such as cash flow forecasts, growt h rates, discount
expected future performance and market conditions
rates and terminal value assumptions. An impairment
such as cash flow forecasts, growt h rates, discount
rates and terminal value assumptions. An impairment
expense of $2,167.8 million was recognised for the
expense of $2,167.8 million was recognised for the
year ended 30 June 2023.
year ended 30 June 2023.
Key assumptions, judgements and estimates used in
Key assumptions, judgements and estimates used in
the Group’s assessment of impairment of non-current
the Group’s assessment of impairment of non-current
assets are set out in Note B6 of the financial report
assets are set out in Note B6 of the financial report
with the impact on impairment of reasonable possible
with the impact on impairment of reasonable possible
changes in the assumptions.
changes in the assumptions.
At 30 June 2023, there was significantly higher
At 30 June 2023, there was significantly higher
estimation uncertainty in relation to impairment
estimation uncertainty in relation to impairment
testing due to the impact of ongoing regulatory and
testing due to the impact of ongoing regulatory and
legal matters. The impact of potential outcomes from
legal matters. The impact of potential outcomes from
the ongoing regulatory and legal set out in Note B7, on
the ongoing regulatory and legal set out in Note B7, on
How our audit addressed t he key audit
mat t er
How our audit addressed t he key audit
mat t er
Our audit procedures included the following:
Our audit procedures included the following:
-
-
these
these
Evaluated the appropriateness of the Cash
Generating Units (CGUs) used by the
Evaluated the appropriateness of the Cash
Group in their impairment assessment and
Generating Units (CGUs) used by the
the allocation of assets and cash flows to
Group in their impairment assessment and
these CGUs.
the allocation of assets and cash flows to
these CGUs.
Evaluated the cash flow forecasts, which
supported the recoverable value of the
Evaluated the cash flow forecasts, which
impairment
non-current assets and
supported the recoverable value of the
recognised.
non-current assets and
impairment
recognised.
to Board
Compared
Compared
to Board
approved budgets. We also considered the
approved budgets. We also considered the
historical accuracy of the Group’s cash
historical accuracy of the Group’s cash
flow forecasting and budgeting processes.
flow forecasting and budgeting processes.
Involved our valuation specialists to assess
Involved our valuation specialists to assess
testing
whether
testing
whether
methodology applied was in accordance
methodology applied was in accordance
with Aust ralian Accounting Standards and
with Aust ralian Accounting Standards and
to evaluate the key assumptions applied in
to evaluate the key assumptions applied in
the impairment models which included
the impairment models which included
growth rates, t erminal value assumptions,
growth rates, t erminal value assumptions,
and discount rates which included the
and discount rates which included the
impairment
impairment
forecasts
forecasts
the
the
-
-
-
-
-
-
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107
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Ernst & Young
200 George Street
Sydney NSW 2000 Aust ralia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
-
to
relating
the ongoing
How our audit addressed t he key audit
mat t er
Independent Audit or’s r eport t o t he Members of The St ar Ent ert ainment
Why significant
Group Limit ed
cash flows increases the risk of inaccurate forecasts
uncertainty
regulatory and legal matters.
and results in a significantly wider range of possible
Report on t he Audit of t he Financial Report
outcomes to consider.
Tested whether the models used were
Accordingly, we considered this a key audit matter.
mathematically accurate and that the
Opinion
For the same reasons, we consider it important that
impairment
correctly
We have audited the financial report of The Star Entertainment Group Limited (the Company) and its
attention is drawn to the information in Notes B4, B5
recorded in the financial statements.
subsidiaries (collectively the Group), which comprises the consolidated balance sheet as at 30 June
and B6 of the financial report on management’s
Performed sensitivity analysis on the key
2023, the consolidated income statement, consolidated statement of changes in equity and
assessment of the impairment testing of goodwill at 30
assumptions to ascertain the extent to
consolidated statement of cash flows for the year then ended, notes to the financial statements,
June 2023.
which changes in those assumptions could
including a summary of significant accounting policies, and the directors’ declaration.
result
further
impairment
in
impairment.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
Assessed the adequacy of the disclosures
included in Notes B4, B5 and B6 of the
financial report, and in particular those
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2023
relating to the cash flow forecasts.
and of its consolidated financial performance for the year ended on that date; and
expense was
or
a.
-
-
b.
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Our audit procedures included the following:
-
Basis f or opinion
Provisions, Cont ingent Liabilit ies and Regulat ory Mat t ers
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
Why significant
How our audit addressed t he key audit mat t er
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
As disclosed in Note B7, the Group is subject to a
independence requirements of the Corporations Act 2001 and the ethical requirements of the
number of significant pending and ongoing regulatory
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
and legal matters.
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
There is complexity in relation to the assessment of
financial report in Australia. We have also fulfilled our ot her ethical responsibilities in accordance with
these matters and uncertainty as to the outcome and
the Code.
future economic outflow
quantification of any
associated wit h each of these matters.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
Australian Accounting Standards
(accounting
our opinion.
standards) provide criteria for the recognition of
liabilities and disclosure of contingent liabilities for
Material Uncertainties Relating to Going Concern
such matters.
We draw attention to Note G of the financial report which outlines the Directors’ assessment of the
The application of these standards required significant
abilit y of t he Group to continue as a going concern. These matters indicate that material uncertainties
judgement in determining whether present obligations
exist that may cast significant doubt on the Company’s ability to continue as a going concern. Note G
existed at balance date, whether it was probable a
describes the basis for the Directors’ assessment that the Group has the ability to continue as a going
future outflow of funds will occur and whether the
concern and the actions they are planning to take to respond to these uncertainties. Our opinion is not
provisions could be reliably measured and the extent
modified in respect of this matter.
of required contingent liability disclosures where these
conditions were considered not to be met .
Where a provision is recognised as disclosed in Note
B7,
in
estimating the provision.
Accordingly, we considered this to be a key audit
matter.
Evaluated the Group’s assessment as to
whether present obligations exist arising
from past events based on the available
facts and circumstances in relation t o these
matters. In order to assess the facts and
circumstances,
the
underlying documentation prepared by the
Group’s internal and external solicit ors, and
other relevant documents.
Held discussions with senior management,
reviewed Board of Directors and Board
Committee
reviewed
correspondence with regulators (where
applicable) and attended Audit Committee
and Risk Committee meetings to understand
key
legal
regulatory, compliance, and
matters.
Inspected legal correspondence and legal
opinions and considered
their content
together with the information we obtained
from our other procedures. Where required
we held inquiries with the Group’s internal
and external legal counsel.
judgement required
is significant
considered
minutes,
there
we
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-
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108
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Emphasis of Mat t er – Regulat ory and Legal Mat t ers
Why significant
How our audit addressed t he key audit mat t er
We draw attention to the regulatory and legal matters disclosed in Note B7 of the financial report. Our
opinion is not modified in respect of this matter.
Key Audit Mat t ers
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our
audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a
separate opinion on these matters. For each matter below, our description of how our audit addressed
the matter is provided in t hat context. In addition to the matter described in the Material Uncertainties
Relating to Going Concern section, we have determined the matters described below to be the key audit
matters to be communicated in our report.
- Where the Group determined that a present
obligation existed, we assessed the basis for
reliable measurement of the provision in
accordance with accounting standards,
including matters such as probabilit y of
out flow, amounts and timing, and our
understanding of the matter from our
procedures.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
Our forensic specialists were involved in the
performance of cert ain of t hese procedures,
where considered appropriate.
- Where a provision was recognised, we
assessed the basis for the estimate and the
calculation of the provisions.
Assessed the disclosures within the financial
report related to these provisions and the
contingent liabilit y disclosures.
-
Impairment t est ing of non-curr ent asset s
Why significant
The Group had non-current assets amounting to
$3,008.8 million at 30 June 2023. The Group
performs an impairment assessment on an annual
basis for goodwill and for other non-current assets,
when there are indicators of impairment.
The impairment test is performed using fair value less
cost of disposal and includes significant assumptions,
judgements and estimates that are affected by
expected future performance and market conditions
such as cash flow forecasts, growt h rates, discount
rates and terminal value assumptions. An impairment
expense of $2,167.8 million was recognised for the
year ended 30 June 2023.
Key assumptions, judgements and estimates used in
the Group’s assessment of impairment of non-current
assets are set out in Note B6 of the financial report
with the impact on impairment of reasonable possible
changes in the assumptions.
At 30 June 2023, there was significantly higher
estimation uncertainty in relation to impairment
testing due to the impact of ongoing regulatory and
legal matters. The impact of potential outcomes from
the ongoing regulatory and legal set out in Note B7, on
How our audit addressed t he key audit
mat t er
Our audit procedures included the following:
-
Evaluated the appropriateness of the Cash
Generating Units (CGUs) used by the
Group in their impairment assessment and
the allocation of assets and cash flows to
these CGUs.
Evaluated the cash flow forecasts, which
supported the recoverable value of the
impairment
non-current assets and
recognised.
these
forecasts
Compared
to Board
approved budgets. We also considered the
historical accuracy of the Group’s cash
flow forecasting and budgeting processes.
Involved our valuation specialists to assess
whether
testing
methodology applied was in accordance
with Aust ralian Accounting Standards and
to evaluate the key assumptions applied in
the impairment models which included
growth rates, t erminal value assumptions,
and discount rates which included the
impairment
the
-
-
-
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107
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151
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Ernst & Young
200 George Street
Sydney NSW 2000 Aust ralia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
Independent Audit or’s r eport t o t he Members of The St ar Ent ert ainment
Informat ion Ot her t han t he Financial Report and Audit or’s Report Thereon
Group Limit ed
The directors are responsible for the other information. The other information comprises the
information included in the Group’s 2023 annual report other than the financial report and our auditor’s
report thereon. We obtained the directors’ report that is to be included in the annual report, prior to the
Report on t he Audit of t he Financial Report
date of this auditor’s report, and we expect to obtain the remaining sections of the Annual Report after
the date of this auditor’s report.
Opinion
We have audited the financial report of The Star Entertainment Group Limited (the Company) and its
Our opinion on the financial report does not cover the other information and we do not and will not
subsidiaries (collectively the Group), which comprises the consolidated balance sheet as at 30 June
express any form of assurance conclusion thereon, with the exception of the Remuneration Report and
2023, the consolidated income statement, consolidated statement of changes in equity and
our related assurance opinion.
consolidated statement of cash flows for the year then ended, notes to the financial statements,
including a summary of significant accounting policies, and the directors’ declaration.
In connection with our audit of the financial report, our responsibilit y is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
Act 2001, including:
If, based on the work we have performed on the other information obtained prior to the date of this
auditor’s report, we conclude that there is a material misstatement of this other information, we are
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2023
a.
required to report that fact. We have nothing to report in this regard.
and of its consolidated financial performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Responsibilit ies of t he Direct ors for t he Financial Report
b.
The directors of the Company are responsible for the preparation of the financial report that gives a
Basis f or opinion
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
financial report t hat gives a true and fair view and is free from material misstatement, whether due t o
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
fraud or error.
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
continue as a going concern, disclosing, as applicable, matters relating t o going concern and using the
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
going concern basis of accounting unless t he directors either intend to liquidate the Group or to cease
financial report in Australia. We have also fulfilled our ot her ethical responsibilities in accordance with
operations, or have no realistic alternative but to do so.
the Code.
Audit or’s Responsibilit ies for t he Audit of t he Financial Report
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
Material Uncertainties Relating to Going Concern
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in with the Australian Auditing Standards will always detect a material misstatement when it
We draw attention to Note G of the financial report which outlines the Directors’ assessment of the
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
abilit y of t he Group to continue as a going concern. These matters indicate that material uncertainties
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
exist that may cast significant doubt on the Company’s ability to continue as a going concern. Note G
the basis of this financial report.
describes the basis for the Directors’ assessment that the Group has the ability to continue as a going
concern and the actions they are planning to take to respond to these uncertainties. Our opinion is not
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
modified in respect of this matter.
judgment and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial report, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and accordance appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Emphasis of Mat t er – Regulat ory and Legal Mat t ers
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
We draw attention to the regulatory and legal matters disclosed in Note B7 of the financial report. Our
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
opinion is not modified in respect of this matter.
effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
Key Audit Mat t ers
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
separate opinion on these matters. For each matter below, our description of how our audit addressed
or conditions that may cast significant doubt on the Group’s ability to continue as a going concern.
the matter is provided in t hat context. In addition to the matter described in the Material Uncertainties
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s
Relating to Going Concern section, we have determined the matters described below to be the key audit
report to the related disclosures in the financial report or, if such disclosures are inadequate, to
matters to be communicated in our report.
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Group to cease to continue
as a going concern.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
Evaluate the overall presentation, st ructure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events in
a manner that achieves fair presentation.
Impairment t est ing of non-curr ent asset s
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
Why significant
How our audit addressed t he key audit
mat t er
-
We communicate with the directors regarding, among other matters, the planned scope and timing of
Our audit procedures included the following:
the audit and significant audit findings, including any significant deficiencies in internal control that we
-
identify during our audit.
The Group had non-current assets amounting to
$3,008.8 million at 30 June 2023. The Group
performs an impairment assessment on an annual
basis for goodwill and for other non-current assets,
when there are indicators of impairment.
We also provide the directors wit h a statement that we have complied wit h relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
Evaluated the appropriateness of the Cash
Generating Units (CGUs) used by the
Group in their impairment assessment and
the allocation of assets and cash flows to
these CGUs.
Evaluated the cash flow forecasts, which
supported the recoverable value of the
impairment
non-current assets and
recognised.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
The impairment test is performed using fair value less
cost of disposal and includes significant assumptions,
judgements and estimates that are affected by
expected future performance and market conditions
such as cash flow forecasts, growt h rates, discount
rates and terminal value assumptions. An impairment
expense of $2,167.8 million was recognised for the
year ended 30 June 2023.
Key assumptions, judgements and estimates used in
the Group’s assessment of impairment of non-current
assets are set out in Note B6 of the financial report
with the impact on impairment of reasonable possible
changes in the assumptions.
At 30 June 2023, there was significantly higher
estimation uncertainty in relation to impairment
testing due to the impact of ongoing regulatory and
legal matters. The impact of potential outcomes from
the ongoing regulatory and legal set out in Note B7, on
Compared
to Board
approved budgets. We also considered the
historical accuracy of the Group’s cash
flow forecasting and budgeting processes.
Involved our valuation specialists to assess
whether
testing
methodology applied was in accordance
with Aust ralian Accounting Standards and
to evaluate the key assumptions applied in
the impairment models which included
growth rates, t erminal value assumptions,
and discount rates which included the
impairment
forecasts
these
the
-
-
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Liability limited by a scheme approved under Professional Standards Legislat ion
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107
111
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT Ernst & Young
200 George Street
Sydney NSW 2000 Aust ralia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
Independent Audit or’s r eport t o t he Members of The St ar Ent ert ainment
Report on t he audit of t he Remunerat ion Report
Group Limit ed
Opinion on t he Remunerat ion Report
Report on t he Audit of t he Financial Report
We have audited the Remuneration Report included in pages 27 to 45 of the directors’ report for the
year ended 30 June 2023.
Opinion
In our opinion, the Remuneration Report of The Star Entertainment Group Limited for the year ended
We have audited the financial report of The Star Entertainment Group Limited (the Company) and its
30 June 2023, complies with section 300A of the Corporations Act 2001.
subsidiaries (collectively the Group), which comprises the consolidated balance sheet as at 30 June
2023, the consolidated income statement, consolidated statement of changes in equity and
Responsibilit ies
consolidated statement of cash flows for the year then ended, notes to the financial statements,
The directors of the Company are responsible for the preparation and presentation of the Remuneration
including a summary of significant accounting policies, and the directors’ declaration.
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is t o express
an opinion on the Remuneration Report, based on our audit conducted in accordance wit h Australian
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Auditing Standards.
Act 2001, including:
a.
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2023
and of its consolidated financial performance for the year ended on that date; and
b.
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis f or opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
Ernst & Young
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our ot her ethical responsibilities in accordance with
the Code.
Scott Jarrett
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
Partner
our opinion.
Sydney
29 August 2023
Material Uncertainties Relating to Going Concern
We draw attention to Note G of the financial report which outlines the Directors’ assessment of the
abilit y of t he Group to continue as a going concern. These matters indicate that material uncertainties
exist that may cast significant doubt on the Company’s ability to continue as a going concern. Note G
describes the basis for the Directors’ assessment that the Group has the ability to continue as a going
concern and the actions they are planning to take to respond to these uncertainties. Our opinion is not
modified in respect of this matter.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislat ion
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislat ion
112
154
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THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT SHAREHOLDER
INFORMATION
ORDINARY SHARE CAPITAL
The Star Entertainment Group Limited has
1,618,680,877 fully paid ordinary shares
on issue.
SHAREHOLDING RESTRICTIONS
The Star Entertainment Group’s Constitution,
as well as certain legislation, and agreements
entered into with the New South Wales and
Queensland gaming regulators, contain certain
restrictions prohibiting an individual from
having a voting power of more than 10% in
The Star Entertainment Group without prior
written approval.
The Star Entertainment Group may refuse
to register any transfer of shares which
would contravene these shareholding
restrictions or require divestiture of the
shares that cause an individual to exceed
the shareholding restrictions.
In July 2012, written consent was granted by
the New South Wales Independent Liquor and
Gaming Authority and the relevant Queensland
Minister for Perpetual Investment Management
Limited to increase its shareholding in The
Star Entertainment Group from 10% up to
a maximum of 15% of issued shares.
VOTING RIGHTS
All ordinary shares issued by The Star
Entertainment Group carry one vote per
share. Performance rights do not carry any
voting rights.
Gambling legislation in New South Wales
and Queensland and The Star Entertainment
Group’s Constitution contain provisions
regulating the exercise of voting rights
by persons with prohibited shareholding
interests, as well as the regulation of
shareholding interests.
As at 28 August 2023
The relevant Minister has the power to request
information to determine whether a person has
a prohibited shareholding interest. If a person
fails to furnish these details within the time
specified or, in the opinion of the Minister,
the information is false or misleading, then
the Minister can declare the voting rights of
those shares suspended.
Failure to comply with gambling legislation in
New South Wales and Queensland or The Star
Entertainment Group’s Constitution, including
the shareholder restrictions mentioned above,
may result in suspension of voting rights.
EQUITY PLACEMENT
On 29 March 2018, The Star Entertainment
Group announced that:
a. it had entered into a subscription agreement
dated 28 March 2018 with its joint venture
partners, Chow Tai Fook Enterprises
Limited (CTF) and Far East Consortium
International Limited (FEC) (Subscription
Agreement) under which the respective
nominated entities of each of CTF and FEC
separately acquire 45,825,000 new fully paid
ordinary shares in The Star Entertainment
Group (equivalent to a 4.99% stake each) at
$5.35 per share, for a total consideration of
$245,163,750 each; and
b. in addition to existing agreements, The Star
Entertainment Group had entered into a
Strategic Alliance Agreement with CTF
and FEC which provides a framework for
the three parties to work together further
to grow The Star Entertainment Group’s
properties and businesses, collaborate on
potentially mutually beneficial development
opportunities and establish a marketing
alliance (Strategic Alliance).
In accordance with the terms of the
Subscription Agreement, 45,825,000 new fully
paid ordinary shares were issued to each of the
respective nominated entities of CTF and FEC
on 16 April 2018.
155
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT SHAREHOLDER INFORMATION (CONTINUED)
On 20 March 2023, there was a change in the
interests of the following nominated entities
of CTF and FEC, each being a substantial
shareholder of The Star Entertainment Group, with
relevant interests held between them increasing to
161,107,816 ordinary shares, representing 9.95% of
the voting power in The Star Entertainment Group:
1. Firmament Investment Pte. Ltd. and its
associated entities (holding 80,553,908 ordinary
shares, representing 4.977% of the voting
power in the Company); and
2. Far East Consortium International Limited,
its controlled entities and its associated
entities (holding 80,553,908 ordinary shares,
representing 4.977% of the voting power in
the Company).
The change in relevant interests relates to the
issuance of new shares to entities associated
with CTF and FEC under the placement and
institutional entitlement offer, with participation
on the retail entitlement offer timetable, pursuant
to the equity raising announced by The Star
Entertainment Group on 23 February 2023.
TOP-UP RIGHT
The Subscription Agreement grants to CTF and
FEC certain top-up rights that entitles each
of them to participate in future equity raisings
undertaken by The Star Entertainment Group
during the term of the Strategic Alliance in order
to maintain their pre-equity raising ownership
interests (Top-Up Right).
The ASX has granted The Star Entertainment
Group a waiver from Listing Rule 6.18 which
prohibits an entity from granting an option
exercisable over a percentage of the entity’s
capital. The waiver granted by ASX permits CTF
and FEC (and their nominees) to maintain, by way
of a right to participate in any issue of shares or
to subscribe for shares, their percentage relevant
interest in the issued share capital of The Star
Entertainment Group in respect of a diluting event.
The waiver from Listing Rule 6.18 is subject to the
terms and conditions imposed by ASX which are
set out in The Star Entertainment Group’s ASX
Announcement dated 21 May 2018, including a
requirement that a summary of the Top-Up Right
be included in each Annual Report.
156
In accordance with the Top-Up Right, if The Star
Entertainment Group undertakes an equity raising
during the term of the Strategic Alliance which
would result in The Star Entertainment Group
issuing 1% or more of its share capital (or would
have such an effect in the case of an issue of
convertible securities) (Equity Raising), then
The Star Entertainment Group must give each of
CTF and FEC (or their respective nominees) an
opportunity to participate in the Equity Raising
on a basis that allows them to maintain their
pre-Equity Raising shareholding percentage.
CTF and FEC (or their respective nominees) will
be entitled to participate in the Equity Raising on
the same terms and conditions (including price) as
all other participants in the Equity Raising.
The Top-Up Right does not operate in respect of
issues of securities:
• under a dividend or distribution plan;
• under an employee incentive scheme (including
on the conversion of any convertible securities
issued under any such scheme);
• pursuant to any takeover bid or scheme of
arrangement; or
• as consideration for the acquisition of an asset
by The Star Entertainment Group or any of its
related bodies corporate.
The Top-Up Right will automatically terminate in
circumstances where:
• CTF or FEC or their respective nominees
and affiliates (as applicable) cease to hold
the shares issued under the Subscription
Agreement; or
• the waiver of ASX Listing Rule 6.18 ceases to
apply (either as a result of the lapse of time or
CTF or FEC no longer complying with the terms
and conditions of the waiver),
whichever occurs first.
If the Top-Up Right ceases or terminates, and
The Star Entertainment Group undertakes an Equity
Raising then (subject to any applicable laws, rules
or regulations) it must consider making (but is not
obliged to make) an offer to CTF and FEC (or their
respective nominees) to participate in the Equity
Raising on a basis that allows them to maintain their
pre-Equity Raising shareholding percentage.
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT SUBSTANTIAL SHAREHOLDERS
The following is a summary of the substantial shareholders as at 28 August 2023 pursuant to notices lodged
with ASX in accordance with section 671B of the Corporations Act 2001 (Cth):
4.977%
4.977%
6.01%
9.97%
NAME
Firmament Investment Pte. Ltd. and its
associated entities
Far East Consortium International Limited and
its controlled entities
DATE OF
INTEREST
NUMBER OF
ORDINARY SHARES(i)
% OF ISSUED
CAPITAL(ii)
20 March 2023
80,553,908
20 March 2023
80,553,908
State Street Corporation and subsidiaries
29 May 2023
Bruce Lawrence Mathieson, Bruce Joseph
Mathieson, and Investment Holdings Pty Ltd ATF
Investment Holdings Unit Trust
27 February 2023
97,315,818
94,952,796
Perpetual Limited and its related bodies corporate
20 June 2023
112,035,592
6.921%
(i) As disclosed in the last notice lodged with the ASX by the substantial shareholder.
(ii) The percentage set out in the notice lodged with the ASX is based on the total issued share capital of The Star Entertainment Group Limited at
the date of interest.
LESS THAN MARKETABLE PARCELS
There were 34,318 shareholders holding less than a marketable parcel of 530 ordinary shares (valued at
$500 or less, based on a market price of $0.945) at the close of trading on 28 August 2023 and they hold a
total of 7,322,995 ordinary shares.
SECURITIES PURCHASED ON-MARKET
The following securities were purchased on-market during the financial year for the purposes of The Star
Entertainment Group’s employee share plans, namely, the General Employee Share Plan, the Tax Exempt
Plan, the Short Term Performance Plan, and the Equity Retention Plan.
Ordinary Shares
Ordinary Shares
NUMBER OF
SHARES PURCHASED
1,127,531
1,127,530
AVERAGE PRICE
PAID PER SHARE
$2.757841
$2.872165
157
THE STAR ENTERTAINMENT GROUP 2023 ANNUAL REPORT SHAREHOLDER INFORMATION (CONTINUED)
TWENTY LARGEST REGISTERED SHAREHOLDERS — ORDINARY SHARES*
RANK NAME
NUMBER OF
SHARES HELD
% OF ISSUED
CAPITAL
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
CITICORP NOMINEES PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
INVESTMENT HOLDINGS PTY LTD
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